CMA starts probe into Nvidia's $40billion takeover of Arm

2 min read | January 07, 2021 02:54 AM PST | By Team Kalkine Media

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The Competition and Markets Authority has launched a probe into the £29.5 billion takeover deal of the UK-based chip designer Arm Holdings by Nvidia on competition concerns.

In September, Nvidia announced that it would buy the British tech group from Japan’s SoftBank and the deal is expected to get completed in eighteen months.
The CMA said it would examine the deal whether it breaches UK competition rules.

(Image source: ©Kalkine Group 2020)

Arm Holdings designs chips for smartphones, computers and tablets, while California-based Nvidia is a graphics chip specialist.
The regulator will be investigating whether after being acquired by NVIDIA, Arm has an incentive to be taken back, increase the prices or lower the quality of its IP licensing services to its competitors.
The chief executive of the CMA, Andrea Coscelli, emphasised that the chip technology industry is worth billions and critical and they will work with other competition authorities around the world to gauge the impact of the deal, ensuring that it does not result into a substandard or costly product reaching to the end consumers.
Apart from the CMA, the UK government is also examining whether the deal should be thwarted either in the public interest or on cyber security grounds.
Meanwhile, Nvidia had stated that it would retain Arm’s neutrality and keep its IP registered in the UK.

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