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3 March, 2021 - 11:45 By Tony Quested

NVIDIA swoop for Arm looks doomed

Trouble is piling up in the US for NVIDIA as it scrambles to justify to regulators a proposed $40 billion takeover of Cambridge superchip architect Arm.

The Federal Trade Commission is fielding rising objections to the deal. Qualcomm, which has multiple operations in Cambridge UK, has joined Google and Microsoft in opposing the deal on anti-trust grounds.

A source close to the discussions revealed to Business Weekly: “Google, Microsoft and Qualcomm are all objecting to the deal because of the anti-competitive nature of the alliance as Nvidia would not have to pay licences.
There is now a >50 per cent chance the deal will fail.”

The source added: “To be honest, NVIDIA is in trouble with the deal worldwide.”

NVIDIA is also locked in talks with UK regulators seeking assurances about its intentions for the combined business if a takeover is sanctioned.

One of the sticking points this side of the Atlantic is the UK government’s insistence that NVIDIA adds 490 jobs to Arm’s UK workforce by September.

The company currently employs 3,004 staff in the UK and a written guarantee by current owner SoftBank committed to pushing this to 3,494 by September 2021.

Sources close to No.10 say NVIDIA has yet to firm up an assurance re growing Arm’s Cambridge and UK headcount.

NVIDIA meanwhile is said to be unconcerned that regulators in major economies around the world are seeking guarantees that the deal will not constitute a global monopoly in the space and freeze out the American company’s competitors.

Sources believe Apple, which is substantially growing its research bases in Cambridge, considered a takeover of Arm last year but feared such a move would be blocked on the same antitrust grounds. 

If the NVIDIA move falls through don’t be surprised if Apple makes a move on Arm – which it financed in modest terms to solve a different kind of funding crisis at the very birth of the Cambridge icon.

NVIDIA has endeavoured to focus on what the takeover of Arm could do for Cambridge and UK technology on a global stage. It has already pledged to create a world-beating AI research hub at Arm’s Cambridge HQ and the companies are understood to be looking at other potential tech gamechangers to boost the local and national economies.

Before the latest trade storm broke globally NVIDIA said it also intended to base its new Cambridge1 supercomputer at KAO Data Centre in Harlow. It is the UK’s most powerful ever supercomputer and a global exemplar.

Will NVIDIA hold its nerve and keep the faith under rising pressure? The Cambridge technology cluster is holding its breath.

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