Qualcomm has been one of those that has objected to Nvidia's acquisition of Arm. This is in addition to the regulatory scrutiny that the deal has already been receiving.
Nvidia Could Drop Out of Its Acquisition Deal with Arm Over Regulatory Approval
In one of the supposedly biggest deals in tech production history, Nvidia could drop out of acquiring Arm due to the lack of regulatory approval. As of press time, there is a lawsuit by the Federal Trade Commission (FTC) against Nvidia that is blocking the deal.
According to an article by Bloomberg, Nvidia is no longer planning to buy Arm, a popular and heavy-performing chip maker, after the company failed to win approval for the acquisition. In addition, Nvidia is said to be "quietly" abandoning the purchase of the chip maker due to the fact that it still has yet to receive any support from regulators.
Nvidia is Still Facing an FTC Lawsuit Blocking the Deal with Arm
Nvidia is currently facing an FTC lawsuit that is blocking the deal with Arm. According to the story by MacRumors, Nvidia announced their official plans to purchase Arm from SoftBank at the price of $40 billion back in September.
During that announcement, however, it was actually clear from the beginning that this massive purchase would be under regulatory scrutiny. This is because Nvidia remains to be a customer of Arm. The latter is also known to have a lot of licensing deals with certain competitors of Nvidia.
US FTC Filed an Official Lawsuit Blocking the Purchase in December 2021
Last month, the US FTC filed an official lawsuit in order to stop Nvidia from acquiring Arm. The FTC believes that the purchase would then give Nvidia control over computing tech and designs that their competitors are also relying on.
According to the FTC, allowing Nvidia to purchase Arm could stifle the innovative next-generation technologies. The commission has also even pointed out that the planned acquisition can "fairly undermine" the competitors of Nvidia themselves.
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Qualcomm Objected to Nvidia's Purchase of Arm
Qualcomm, the popular Chipmaker, is actually one of the competitors of Nvidia that objected to the purchase.
Back in February, the San-Diego based company noted to the FTC, the UK Competition and Markets Authority, the European Commission, and China's State Administration for Market Regulations that this particular acquisition would then allow Nvidia to become the gatekeeper for technology from Arm, which would then prevent other chip makers from being able to use it.
With the deal looking like it will not be approved, Nvidia is currently telling its partners that it does not expect the transaction with Arm to close. Softbank is now also preparing for an initial public offering or IPO in case the Nvidia takeover will not happen.
Bloomberg, however, has noted that both companies are still in communication with certain regulators as of press time because they are hoping that the situation may still change. Unless the FTC chooses not to push through with its lawsuit, the deal between Nvidia and Arm will most likely not happen any longer.
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This article is owned by Tech Times
Written by Urian B.
