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.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
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.
-
Renewable investing: who is paying for the green revolution?Investors in renewables have not been rewarded, says Bruce Packard. Will they fund the government’s plans?
-
UK house prices rose 4.6% last year – where did property prices grow most?House prices increased by 4.6% in 2024, giving an average property price of £268,000. Where did property prices grow the most and will they continue to rise this year?
-
Renewable energy investing: who is paying for the green revolution?
Investors in renewables have not been rewarded, says Bruce Packard. Will they fund the government’s plans?
-
The best ways to invest in Vietnam – Asia’s communist dynamoVietnam has long been one of our favourite markets. The prognosis remains auspicious, says Alex Rankine.
-
India is a new global powerhouse — should you invest?India’s growth rate has slowed recently, but there is still ample scope for investors to benefit from its development.
-
Why Chinese stocks are so far out of favourThere’s little appetite for Chinese stocks despite low valuations.
-
Three companies that dominate their markets with critical productsA professional investor tells us where he’d put his money. This week: Charlie Huggins, manager of Wealth Club’s Quality Shares Portfolio, picks three stocks.
-
Should you continue to hold Smithson Investment Trust?Opinion Smithson Investment Trust, a small- and mid-cap fund, has struggled to live up to lofty expectations, says Rupert Hargreaves.
-
Primark owner Associated British Foods is an overlooked gem going cheap — should you buy shares?Associated British Foods, the owner of Primark, is a family-owned business, which means it is passed over by the increasingly popular passive investment funds. That spells opportunity for private investors, says Jamie Ward.
-
Deepseek's Liang Wenfeng: the maths whizz who shook Big TechFew people had heard of Liang Wenfeng until the launch of his DeepSeek AI chatbot wiped a trillion dollars off US technology stocks. His pivot to AI was of a piece with his past exploits.
