NVIDIA definitively abandons its bid to buy ARM

Written by Guillaume
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Estimated to be worth more or less $40 billion, the deal has raised too many comments and questions for it to be completed.

In September 2020, NVIDIA confirmed persistent rumors by announcing the acquisition of the British company ARM owned by SoftBank. At the time, there was talk of a colossal investment so that the Japanese company would land on its feet: in July 2016, SoftBank had indeed disbursed the hefty sum of $32 billion to get its hands on the British industrial flagship. Problem is, in all these years, SoftBank has never found the right formula to take full advantage of the famous manufacturer of the chips found in most smartphones.

It was common knowledge that SoftBank had been looking to divest itself of ARM for many months, but no one seemed to be interested or able to finance such an operation. Indeed, neither customer nor supplier of ARM, SoftBank had not met any resistance at the time of its acquisition. However, most of the companies potentially interested in buying ARM are closely or remotely linked to the world of smartphones and semiconductors. This is the problem that NVIDIA has been facing for more than 18 months now.

As soon as this takeover attempt was made official, NVIDIA met with reservations from many players. Google, Microsoft and Qualcomm were among the first to publicly express their concerns about such a merger. They were quickly followed by others before regulators and institutions started to take an interest in the issue. The Federal Trade Commission (FTC) has taken no chances in indicating its intention to launch a lawsuit to block this takeover: the FTC raises the possibility, once the deal is approved, that NVIDIA will restrict access to ARM technology to some of its competitors or manipulate prices abusively.

Of course, NVIDIA and SoftBank initially tried to justify their position, but the difficulties accumulated with the entry on the scene of the British regulator and the possible intervention of the European Commission. In the end, it didn't have to come to that. The New York Times explains that NVIDIA has decided to withdraw its offer and forget about this great acquisition. NVIDIA has not yet commented on the matter, but SoftBank would already have other ideas to get rid of ARM: the Japanese would consider an opening to the public, knowing that 24 years ago, ARM made a first IPO.