EU opens probe into Nvidia's $40 bn acquisition of chip maker Arm

London, Oct 28 (IANS): The European Commission has opened an in-depth investigation to assess the $40 billion acquisition of chip designer Arm by graphic chip giant Nvidia.

The Nvidia deal to purchase the UK-based company Arm from SoftBank for $40 billion was announced in September last year.

The Commission said in a statement late on Wednesday that the merged entity would have the ability and incentive to restrict access by Nvidia's rivals to Arm's technology, and that the proposed transaction could lead to higher prices, less choice and reduced innovation in the semiconductor industry.

Semiconductors are everywhere in products and devices that we use everyday as well as in infrastructure such as data centres.

"While Arm and Nvidia do not directly compete, Arm's IP is an important input in products competing with those of Nvidia, for example in data centres, automotive and in Internet of Things (IoTs)," said Margrethe Vestager, Executive Vice-President and responsible for competition policy.

"Our analysis shows that the acquisition of Arm by Nvidia could lead to restricted or degraded access to Arm's IP, with distortive effects in many markets where semiconductors are used," Vestager added.

Nvidia develops and supplies processor products for various applications, including in data centres, IoT, automotive applications and gaming.

Arm licenses out intellectual property (IP) for processing units, in particular to semiconductor chipmakers and Systems-on-Chip (SoC) developers.

The Commission said that by acquiring Arm, Nvidia would gain full control over Arm's technology and licensing business.

The preliminary investigation suggests that the merged entity would also have the economic incentive to engage in such foreclosure strategies which could reduce competition in the market for the supply of processor products across different fields of application.

The Commission will now carry out an in-depth investigation into the effects of the transaction to determine whether its initial competition concerns regarding these markets are confirmed, and will take a decision by March 15, 2022.



Top Stories

Leave a Comment

Title: EU opens probe into Nvidia's $40 bn acquisition of chip maker Arm

You have 2000 characters left.


Please write your correct name and email address. Kindly do not post any personal, abusive, defamatory, infringing, obscene, indecent, discriminatory or unlawful or similar comments. will not be responsible for any defamatory message posted under this article.

Please note that sending false messages to insult, defame, intimidate, mislead or deceive people or to intentionally cause public disorder is punishable under law. It is obligatory on Daijiworld to provide the IP address and other details of senders of such comments, to the authority concerned upon request.

Hence, sending offensive comments using daijiworld will be purely at your own risk, and in no way will be held responsible.

Security Validation

Enter the characters in the image