The European Union will check the acquisition of Arm by NVIDIA
|The European Union and the United Kingdom are set to launch a thorough investigation into NVIDIA's $40 billion acquisition of the British chipmaker Arm, the Financial Times reported. |
Officials in Brussels and the U.K. said the deal needed to be scrutinized carefully, given the growing importance of Arm's developments, which are used in almost all smartphone processors and a host of different gadgets. One of the informed sources of the Financial Times admits that as a result of the investigation, the transaction will be blocked.
Announced in September of last year, the deal also expects a thorough inspection in the United States and China. The Competition and Markets Authority (CMA) invited market participants to express their opinion on this issue and promised to conduct an investigation in the coming months. Meanwhile, the paperwork will be carried out in Brussels.
Arm solutions are widely used by companies such as Apple, Samsung, Qualcomm, and Broadcom. And some firms that depend on Arm's know-how fear losing access to its technology when it becomes the property of NVIDIA, their competitor. NVIDIA CEO Jensen Huang (Jensen Huang) categorically rejects such concerns. In a letter sent to Monetary Occasions, he said: "I can unequivocally assure that NVIDIA will maintain the Arm open licensing model." He stressed that NVIDIA has no intention to prevent the provision of Arm development to any of the consumers.
Nevertheless, NVIDIA's competitors lobbied the EU and UK regulatory authorities for an investigation to thwart the deal, according to a number of experts with knowledge of the situation. "There are concerns that in the medium to long term, NVIDIA will use Arm to damage various corporations and advance its know-how," said one of the rivals involved.
Competitors are also concerned that regulators may be powerless to pressure Arm to remain neutral in the future. "There is a high probability that the deal will be blocked due to the lack of a real strategy to protect neutrality. NVIDIA may have insurmountable financial incentives to merge its parts with Arm. In any other case, why is it paying (such a huge amount) $40 billion?", - said one of the informed sources.
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