Nvidia’s plans to acquire Arm may be toast
Nvidia’s plan to take over Armhas been stalled by a lot of anti-competition resistance since its first announcement.Probes from European regulators, anFTC lawsuit, and even growing concerns in China ensured the buyout was dead upon arrival. After all that, Nvidia now looks set to walk away from the acquisition, according to the latest reports.
All indications point to an end for the mega deal, with Nvidia said to have already told partners that it doesn’t expect the deal to close, in a report from an anonymous source (perBloomberg). It’s also being reported that SoftBank is working to take Arm public as an alternative. In spite of these reports, Nvidia is not conceding defeat just yet, at least not publicly. Instead, the chipmaker seems hopeful, maintaining that the transaction will accelerate Arm and boost competition and innovation, according to a statement from spokesperson Bob Sherbin.
The acquisition had many upsides for what is already the most valuable U.S. company in the semiconductor industry. Arm designs are as ubiquitous as it gets, being used across various industries — everything from smartphones, computers, and TVs to more obscure products like antilock braking systems. These qualities are even more appealing to Nvidia since it expanded its GPU manufacturing business to incorporate SoCs. The initial agreement expires on September 13, 2022, but it could automatically renew if a unanimous decision is reached. That said, a closure looks increasingly less likely to happen, especially when you consider that the FTC lawsuit alone — amid other antitrust probes — will not be completed in the immediate future.
If Nvidia does manage to pull it off, it would be the largest semiconductor chip merger in history — but it will be an uphill fight. Competitors including Qualcomm, Intel, and Google are averse to the idea, insisting that the takeover would limit their access to Arm designs, even though Nvidia claims otherwise. If the deal falls through, Arm and SoftBank will get to keep the $2 billion Nvidia paid upon signing and an additional $1.25 billion breakup fee.
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