Qualcomm tries to prevent Arm takeover by Nvidia
The British Arm Ltd. announced in September that it had struck a $ 40 billion deal with Nvidia to acquire the company. Qualcomm, Microsoft and Google are trying to thwart the acquisition by complaining to international market watchdogs.
Acquisition of Arm by Nvidia
Virtually all mobile chipsets in phones have been developed on the basis of technology from Arm Holdings, a British company currently owned by the Japanese Softbank. The current owner announced in 2020 that he was looking for a takeover candidate, which was found in Nvidia – a producer of graphics chips and smart computers for cars, for example.
Signs soon followed from the chip industry that there were fears for the future of the chip developer – parties that purchase licenses from Arm chips, such as Qualcomm, were afraid that they could no longer purchase these licenses in the future.
Neutral attitude
At the time of the deal, Nvidia said it will maintain a “neutral stance” towards Arm customers. However, several companies seem uneasy about it, and have engaged with international market watchdogs in the United States, the United Kingdom, the European Union and in China. Which companies are involved in the talks with market watchdogs remains unknown. According to Bloomberg, Google, Microsoft and Qualcomm, among others, are involved.
One of the parties involved in the talks has indicated that watchdogs should block this deal in its entirety. It is not known which company made this statement. Commenting on the companies’ talks, Nvidia said its acquisition plans will contribute to the growth of the (chip) industry: “Our vision for Arm will help all of Arm’s licensees grow their businesses and enter new markets. ”
‘Long and painful investigation’
“You are looking at a very thorough, very painful and very long investigation,” a source told CNBC. In the United States, the investigation is currently in the second phase, in which the parties involved must provide the necessary information for the investigations. It is difficult to say for how long the investigations will continue, but it is certain that the change of power in the US will delay the investigation.
Should Arm’s acquisition deal be approved, there would be little for companies to worry about, according to Nvidia. However, the CEO of Graphcore, a chip developer, said that the acquisition could lead to limited access to chip designs for companies active in the chip industry.
Given the reliance on Arm, about 95 percent of chips in phones use Arm designs, this could have profound implications. Also suspicious of the acquisition are Nvidia’s non-binding statements about its post-acquisition attitude.
