US Federal Trade Commission sues NVIDIA and blocks $ 40 billion ARM purchase

For 2 years now that NVIDIA wants to buy the British company ARM, for a transaction valued at 40,000 million dollars, it has just encountered another obstacle. The FTC (the US Federal Trade Commission) will try to prevent the purchase from being made.

According to the FTC, the acquisition could stifle competition in next-generation technologies. This obstacle is not the first, just over a month ago the European Commission opened a similar investigation to assess the negative effects of all the power that NVIDIA would have in its hands.

The transaction between NVIDIA and ARM was announced in September 2020, but the negotiation can only be concluded after government agencies provide assurance that the deal will go through. In the words of the FTC, the acquisition It would give one of the world’s largest chip companies control of the computer technologies and designs that competing companies depend on to develop their own components.

I give you an example: NVIDIA buys ARM, the latter stops licensing, with this, bye Qualcomm and other companies. When they found Qualcomm for not being able to sell more CPUs, they buy it at two pesos to keep the licenses, and with that a nice Monopoly is coming …

In the report released by the FTC, the agency details that data centers are among the segments that need advanced semiconductors. Without competition, these sectors would be at the mercy of NVIDIA, since there would practically exist a monopoly in the manufacture of essential components.

For now, an administrative hearing to review the case is scheduled for May 10, 2022. Therefore, this means that until then the deal cannot be completed. If approved, NVIDIA would still have to face legal proceedings in Europe. In practice, this means that the process can take at least one more year.

It’s a statement, NVIDIA doesn’t seem bothered by the FTC’s position and stated that it will provide all necessary clarifications for the agreement to proceed.

“As we move to the next step in the process with the FTC, we will continue to work to demonstrate that this transaction will benefit the industry and promote competition. NVIDIA will invest in ARM R&D, accelerate its roadmaps and expand its offerings in ways that increase competition, create more opportunities for everyone with ARM licenses, and expand its ecosystem. NVIDIA is committed to preserving ARM’s open license model and ensuring that its IP is available to all current and future interested licensees. “

Source: Engadget