Jan 25, 2022 - Economy

Report: Nvidia prepares to abandon $40B Arm deal

Dan Primack

Illustration of a computer chip with a pause button in the center. — Illustration: Aïda Amer/Axios

Nvidia is preparing to abandon its $40 billion acquisition of British chip design firm Arm from SoftBank due to regulatory opposition, per Bloomberg.

Why it matters: This was set to be the largest-ever merger in the semiconductor industry, and could lead to SoftBank taking Arm public via an IPO. It also would come three years after Qualcomm bailed on its efforts to buy NXP Semiconductors, also because of regulatory backlash.

History: Nvidia announced the cash-and-stock deal in Sept. 2020. The FTC sued to block it last month, arguing that Arm's designs are key enablers of competition between Nvidia and its rivals.

There's also an assumption that Chinese regulators would move to block the deal, were other countries to acquiesce.

The bottom line: "Tech giants have lined up against the takeover. A group that includes Qualcomm, Microsoft, Intel and Amazon have provided regulators around the world with what they believe is enough ammunition to kill the deal, according to people familiar with the process," Bloomberg writes.

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Report: Nvidia prepares to abandon $40B Arm deal

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