UK government considering blocking Nvidia's $40bn Arm takeover

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www.capacitymedia.com, Aug. 04, 2021 – 

The UK government is apparently considering blocking chip maker Nvidia from completing its $40 billion acquisition of British competitor Arm on "national security" grounds.

Arm chips are integral in the production of most smartphone supply chains, the evolving Internet of Things market and in supporting the roll-out of 5G. They are also becoming a popular option in some data centre applications too.

A previous Tory-led UK government allowed Arm to be acquired by Japan's SoftBank five years ago for over £24 billion, after similar concerns were raised.

But now, it seems, there is greater pressure on a new deal being passed. SoftBank kept to its word that Arm would remain headquartered in Cambridge, UK and US firm Nvidia has said the same regarding its own proposed deal first announced last September.

The UK government asked the country's Competition and Markets Authority (CMA) to look at the takeover, and its first report was sent to the government last month. In that report, it is said there are "worrying implications for the UK's national security" being cited.

The government is now expected to take a deeper look into the deal, although it will have to deal with questions as to why Arm was allowed to be acquired by Japan's SoftBank, and why Arm being taken over by a US company is potentially more damaging - particularly if its headquarters and R&D remain in the UK.

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