U.K., China Opposed to the Deal
Samsung Electronics, Amazon and Tesla CEO Elon Musk expressed their objection to Nvidia’s ARM acquisition. The possibility of M&A failure is rising, with competition authorities opposed to it as well.
ARM is the largest semiconductor chip designer in the United Kingdom and its clients include Apple, Qualcomm and Samsung. More than 95 percent of smartphones worldwide use ARM’s technology. Nvidia announced in September last year that it would acquire ARM for US$40 billion. Google, Microsoft and Qualcomm expressed objection right after the announcement.
The acquisition requires approvals from the regulatory authorities of the United States, the United Kingdom, China and the European Union. At present, the United Kingdom and China are opposed to it. The Competition and Markets Authority of the United Kingdom recently initiated an additional probe, mentioning that the acquisition may hinder fair competition. The Chinese government is postponing its probe.
What they are concerned about is that Nvidia may monopolize chip design techniques by taking over ARM. This can be a serious matter on their part with competition in the semiconductor industry increasingly becoming hegemonic competition.