The giant of Graphic cards will therefore not get hold of the one that is present in a large majority of smartphones.
This soap opera which will have kept us in suspense for a little over eighteen months seems to be coming to an end, and not in the best way for NVIDIA which is giving up on this acquisition estimated at 40 billion dollars.
The Americans wanted to buy the Briton from the Japanese
As early as July 2020, we relayed the first rumors of an offer made by NVIDIA for the takeover of ARM. It was then only a question of ” advanced discussions “, but there was already talk of an offer in excess of $ 32 billion made to SoftBank.
The Japanese company has effectively owned the British company since July 2016. At the time, it acquired it for the tidy sum of $31 billion but seems never to have been able to profit from its acquisition.
At the time, the competition authorities had not raised any objections. Indeed, neither a customer nor a supplier in the smartphone market, ARM’s core business, SoftBank was considered ” neutral on this particularly competitive sector.
The fear of price manipulation
Things are obviously very different for NVIDIA, and only a few weeks after formalizing its desire to buy ARM in September 2020, the American encountered multiple oppositions. First, companies like Microsoft, Google or Qualcomm have expressed their concerns.
These concerns were then taken up by UK regulators before the Federal Trade Commission (FTC) announced outright legal action to block NVIDIA’s takeover of ARM. The FTC indeed fears that once the contract is concluded, NVIDIA will be able to restrict access to ARM technology for certain competitors and to manipulate prices.
NVIDIA’s lawyers like those of SoftBank obviously tried to oppose their own point of view, but things were clearly not progressing in favor of a validation of the operation. At the very beginning of the year, NVIDIA also seemed resigned and had informed its partners that the case would never be validated.
Towards an opening of ARM to the public
Today, The New York Times confirms that the negotiations have indeed stopped and that NVIDIA has finally decided to back down in the face of constraints. This is of course a serious setback for NVIDIA, but also for its co-founder and director, Jensen Huang.
The latter has been counting for several years on the diversification of his company in order to go beyond graphic solutions. Artificial intelligence and the Cloud are some of its hobbyhorses. Getting your hands on ARM and taking a big step towards the smartphone market was another.
NVIDIA hasn’t made any official statement yet, but The New York Times already evokes the reaction of SoftBank. The Japanese company is still considering parting ways with ARM, and since the takeover won’t happen, it would look to going public, 24 years after ARM’s first IPO in 1998.
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Source: The New York Times