Updated · May 20, 2022
Nvidia’s Planned Takeover of Chip Group Arm Falls Through
Updated · Feb 21, 2022
Softbank’s planned sale of Arm Ltd. to Nvidia collapsed following regulatory hurdles. Consequently, the UK-based firm will now seek a public listing.
Japanese multinational conglomerate Softbank has scrapped the planned sale of its microchip business, Arm, to US chipmaker Nvidia. The deal collapsed on Monday following obstruction from regulators in the US, UK, and the European Union.
Both companies announced the collapse in a joint statement on Tuesday.
“The parties agreed to terminate the Agreement because of significant regulatory challenges preventing the consummation of the transaction, despite good faith efforts by the parties.”
When it was first announced in September last year, the cash-and-stock transaction was worth close to $40 billion. However, it would have been worth up to double that as Nvidia’s share price soared in the time since. The game industry played a vital role in helping the firm’s stock rise as customers upgraded their graphics cards.
Companies like Microsoft, Apple, and Qualcomm depend on Arm to power a range of products, like mobile phones and smart devices. As a result, there were fears that the deal would seriously hurt competitors. In December, the U.S. Federal Trade Commission sued to block the sale, citing antitrust issues.
Future IPO for Arm
Nvidia and Softbank’s statement added that Arm “will now start preparations for a public offering.”
“Arm is the becoming the center of innovation not only in the mobile phone revolution but also in cloud computing, automotive, the Internet of Things, and the metaverse,” said Masayoshi Son, Softbank’s CEO. “We will take this opportunity and start preparing to take Arm public, and to make even further progress.”
Softbank aims to have Arm publicly listed by March next year.
Daniel is an Economics grad who fell in love with tech. His love for books and reading pushed him into picking up the pen - and keyboard. Also a data analyst, he's taking that leap into data science and machine learning. When not writing or studying, chances are that you'll catch him watching football or face-deep in an epic fantasy novel.
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