Monday, May 29

Nvidia gives up the purchase of ARM: pressure from regulators reverses the historic agreement

The largest acquisition in the history of semiconductors does not seem to have a good ending. Nvidia announced the purchase of ARM for 40,000 million dollars, but regulators have shown their doubts about this agreement from the beginning. A year and a half after the announcement, the purchase has not materialized and, according to Bloomberg, it will not be done then Nvidia has already thrown in the towel with ARM.

Nvidia would have already communicated to its suppliers and allies that it does not expect to finalize this acquisition, according to a source close to the negotiations. Another source points out that SoftBank, owner of ARM, would already be preparing an ARM IPO as an alternative to the failed purchase by Nvidia.

Even ARM customers were hesitant

The deal was historic, but it also meant a real windstorm within the semiconductor industry. Even ARM’s own customers expressed their doubts about this acquisition, which gave too much power to Nvidia.

Last December, the US FTC took a position against it, pointing out that it would be an anti-competitive purchase. Months earlier it was the European Union that set out to investigate this purchase, describing that Nvidia had not “offered sufficient concessions” to ARM, even after stating that ARM would remain vendor neutral for brands like Samsung, Apple or Qualcomm.

The final decision of the European Union is scheduled for March 15, 2022. However, sources close to Nvidia already point out, as described by Bloomberg, that the agreement would be lost.

The acquisition also showed signs of rejection from China, although the Chinese regulator has not made an official statement.

At the moment there is no official statement and the matter is not closed. The official position from Nvidia is that they continue to work to “demonstrate that this transaction will benefit the industry and promote competitiveness.”

The case could end up like Qualcomm’s with NXP, that after two years of discussions between the US and Chinese administrations, the purchase valued at 47,000 million dollars did not materialize. The giants of the world of semiconductors continue to move, but at these levels the position of the regulators is very present.

Via | Bloomberg