EU to investigate Nvidia's ARM takeover
Concerns surrounding Nvidia's intentions with Arm's chip designs are gaining traction
The EU is set to follow the UK's lead by launching a competition investigation into Nvidia's acquisition of Arm.
The £30 billion dollar deal warrants "serious scrutiny", officials and advisors in Brussels have said according to The Financial Times.
Concerns have been steadily growing over Nvidia's intentions with Arm's chip designs and its extensive client relationships. Some of Nvidia's competitors have reportedly lobbied the UK and EU governments to investigate the deal, people familiar with the story told The Financial Times, though no companies have been spcifically named.
In the UK, the Competitions and Markets Authority (CMA) said it would consider the takeover and seek insight and opinions from third-parties up to 26 January. With the deadline gone, the CMA is set to review "whether, following the takeover, Arm has an incentive to withdraw, raise prices or reduce the quality of its IP licensing services to Nvidia's rivals".
The deal is also reportedly being looked into by US and Chinese authorities, with the EU seemingly the last authority to be linked with an investigation into the acquisition.
"There is a good chance of the deal being blocked because there is no real way to preserve neutrality," a Financial Times source was quoted as saying. "There will be irresistible economic incentives for Nvidia to combine elements with Arm. Otherwise, why are they paying $40 billion?"
Arm was first acquired by the Japanese investment group Softbank in 2016, a takeover that was completed "easily", according to Russ Shaw, the founder of London Tech Advocates.
"Nearly five years later, the UK and other nations have realised the enormous potential and importance of the semiconductor industry and why ARM is such an important asset," he said.
"Arm is one of the UK's most important tech companies and sits at the heart of the geopolitical landscape with respect to chip design. It is therefore not surprising that both UK and EU Competition authorities are wanting to investigate Nvidia's $40 billion bid for Arm."
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