Arm Holdings takeover: has Nvidia had its chips?
The takeover of Britain’s semiconductor group Arm Holdings by its US rival Nvidia could be running into the sand, says Matthew Partridge.

The $40bn acquisition of British semiconductor manufacturer Arm Holdings by America’s Nvidia has been left hanging in the balance, says Amy Thomson on Bloomberg. The culture secretary, Oliver Dowden, says the government may intervene to prevent the tie-up. Dowden has ordered the Competition and Markets Authority (CMA), which is already looking at the impact on competition, to investigate the national security aspects of the deal too.
He notes that the semiconductors are not only “fundamental” to a “wide range of technologies”, including those in defence and national security, but also “underpin the UK’s critical national infrastructure”. Nvidia’s ownership could bring Arm under the “control of powerful US national security laws” that could one day be “used against Britain’s interests”, says Hannah Boland in The Daily Telegraph.
The next US tech monopoly
National security concerns aren’t the only reason why some are opposing the deal, says Mark Sweney in The Guardian. Hermann Hauser, Arm’s original co-founder, has argued that it would be “an absolute disaster for Cambridge, the UK and Europe”, as Nvidia would inevitably decide to relocate Arm to the US, leading to lost jobs.
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More importantly, being owned by Nvidia would also destroy Arm’s “even-handed” model of licensing its chip designs to a wide range of technology companies, including Apple, Samsung and Qualcomm, turning the combined company into “the next US tech monopoly alongside companies such as Google, Facebook and Amazon”.
Even if the British government eventually gives the deal its blessing, it still might not go ahead, says Gina Chon on Breakingviews. Thanks to complaints from Microsoft and Google, the US Federal Trade Commission (FTC) also has the deal under “extended review” on competition grounds. An “unprecedented” semiconductor shortage is already causing the FTC review to go on for much longer than originally anticipated and giving it “more reason to hit pause”. The “global regulatory pile-on” means that Nvidia and Arm “must prepare for regulators to chip away further”.
Although Nvidia continues to maintain that it “can score the necessary government approvals to close the Arm deal”, its behaviour is making this harder, says Dan Gallagher in The Wall Street Journal. Last week Nvidia announced the launch of a new central processing unit, or CPU, called Grace. It is designed for use in data centres, which would effectively compete for the data-centre slots mostly occupied by chips from Intel and Advanced Micro Devices (AMD). While the move boosted Nvidia’s share price, the fact that both Grace and the current offerings from AMD and Intel use Arm technology makes it easy to see how merging Nvidia and Arm could reduce competition.
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Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.
He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.
Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.
As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.
Follow Matthew on Twitter: @DrMatthewPartri
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