Nvidia’s $40 Billion Arm Acquisition Could be Targeted by Chinese Regulators, Analysts Say



Sam Shead | CNBC

LONDON – Regulators in China could be a major barrier in Nvidia’s attempt to buy U.K. chipmaker Arm from SoftBank for $40 billion, according to analysts.

The mega-deal, which would create the largest chip company in the West by market value and global reach, was announced at the start of September. But it is far from being home and dry, with multiple regulators able to weigh in including China’s Ministry of Commerce (MOFCOM) and China’s State Administration for Market Regulation (SAMR).

“Technically, Beijing can block the deal,” Abishur Prakash, a geopolitical specialist at the Center for Innovating the Future, a Toronto-based consulting firm, told CNBC by email.

It wouldn’t be the first time Chinese regulators have prevented a U.S. chip firm from buying a European player. In 2018, SAMR blocked Qualcomm’s attempt to buy Dutch chipmaker NXP.

Bill Ray, a senior director analyst at research firm Gartner, told CNBC by email that Chinese regulators “will seek to extract specific guarantees before granting approval.”

He added that “some of these guarantees may be beyond the ability of Nvidia to provide,” specifically calling out the ongoing provision of Arm’s intellectual property (IP) to Chinese businesses.

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