Nvida Corp.(NVDA) proposed $40 billion deal to buy Arm, British chip designer company, which seems to face regulatory challenge around the world. For now, that starts with British government (Woo & Sylvers, 2021, April 19). When SoftBank bought it  in 2016, it made promise to keep jobs in Britain (Woo. & Dou, 2016, July 18). For the same reason, Labour Party is against Nvida’s acquisition as it sees potential job losses.

Nvida is founded in 1993Santa Clara, CA, in 1993 by Jensen Huang and becomes one of the biggest chip designer for graphics for videogames, data analytic and automation with artificial intelligence (Fitch & Woo, 2020, September 13).

Arm Holdings is one of the global semiconductor companies, who designs and licenses  90% of smartphone chips worldwide. Particularly, it is known for its least energy consuming chip designing. It has partnership with Samsung Electronics Co., Qualcomm, and others. As  Arm Holding had been working with global chip producers as a supplier, it announced its “A Shared Purpose” that would not have exclusive relationship with any partner. SoftBank Group Corp bought it at $32 billion and sold it at $40 billion to Nvida (Fitch & Woo, 2020, September 13). 

This deal offers a great position to Nvida to compete against Intel and to be able to work with smartphone producers including Apple. Particularly in early 2021, there are great attention to chip makers between China and USA. We will see how this plays out in turbulent global politics.

Please cited as :

Rachel Kim (2021, April 22). NVIDA’s Acquisition Deal of Arm Holdings in Doubt & Hostility in UK, The Blue Ocean Management.com, retrieved from: https://theblueoceanmanagement.com/category/theblueoceanmanagement-com/market-trend-foresight/game-industry/

References:

Woo, S. & Dou, E. (2016, July 18). SoftBank to Buy ARM Holdings for $32 Billion, Wall Street Journal, retrieved from: https://www.wsj.com/articles/softbank-agrees-to-buy-arm-holdings-for-more-than-32-billion-1468808434

Fitch, A. & Woo, S. (2020, September 13). What Are Nvidia and Arm? And Why Are They Combining?, Wall Street Journal, retrieved from: https://www.wsj.com/articles/who-are-nvidia-and-arm-and-why-are-they-talking-about-getting-together-11599938641

Woo, S. & Sylvers, E. (2021, April 19). Nvidia’s $40 Billion Deal for Arm Faces U.K. National-Security Probe, Wall Street Journal, retrieved from: https://www.wsj.com/articles/u-k-starts-national-security-probe-of-nvidia-s-40-billion-deal-to-buy-arm-11618837683