American multinational technology company Nvidia said it will answer “any concerns” raised by the company. European Commission Regulators appear to be preparing to investigate the company’s proposed US$54 billion (£39 billion) acquisition of British chip design company Arm.
The world’s leading graphics and artificial intelligence chip manufacturer is expected to notify the committee of its procurement plan in early September armAt that time, the regulatory agency may conduct a preliminary review.
British Competition and Market Authority Say After preliminary assessment, the transaction raised “serious competition concerns” because it may “stifle innovation in multiple markets.”
Arm licenses important intellectual property rights to other chip manufacturers. There are concerns that the proposed transaction will give Nvidia the ability to harm its competitors by reducing access to Arm products. The American company denies this claim.
The British government is also reviewing the transaction on national security grounds, which further hinders its completion. The British Secretary of Culture Oliver Dowden can approve the transaction, approve the transaction based on certain commitments, or request the CMA to initiate a more detailed second-stage investigation.
This is how the industry and regulators reacted to the expected transaction announced in September last year. Nvidia had to admit that the acquisition would not take place within the 18 months originally planned.
Nevertheless, Nvidia claims to be supported by Arm customers MediaTek, Broadcom and Marvell.
After the company notifies the committee, a preliminary review will be conducted within 25 working days. During this period, the company may provide some concessions to smooth the regulatory process. It is expected that committee officials will conduct a full 90-day investigation.
Sign up for Daily Business Today email or follow Guardian Business on Twitter @BusinessDesk
An Nvidia spokesperson said: “This transaction will benefit Arm, its licensees, competition and the industry. We are going through the regulatory process and we look forward to working with the European Commission to resolve any issues they may have.”
Last fiscal year, Nvidia’s revenue was 16.68 billion U.S. dollars, higher than 2020’s 10.92 billion U.S. dollars.
A spokesperson for the Commission said: “We have no specific comment. The transaction has not been formally notified to the Commission. If the transaction involves the EU level, the company will always notify the Commission.”
