Home » Economy » Nvidia, SoftBank call off blockbuster Arm deal
Nvidia, SoftBank call off blockbuster Arm deal
Global chip shortage making it hard to meet demand: onsemi CEO
Hassane El-Khoury discusses how the supply chain disruption is impacting production on ‘The Claman Countdown.’
Nvidia Corp. and Japan’s SoftBank Group Corp. are abandoning a blockbuster deal for the U.S. semiconductor giant to acquire chip-design specialist Arm after regulators raised antitrust concerns, a person familiar with the matter said.
SoftBank, which owns Arm, now plans to pursue a public listing for the U.K.-based chip business, the person said.
The U.S. graphics chip giant in September 2020 agreed to buy Arm for $40 billion from SoftBank in what would have been the chip industry’s biggest deal ever. The nominal value of the deal had risen along with Nvidia share price that has advanced sharply in the intervening time amid booming semiconductor demand.
FTC CHALLENGES NVIDIA’S DEAL FOR ARM HOLDINGS
The proposed deal quickly raised eyebrows with regulators and chip-making rivals. The Federal Trade Commission in December sued to block the transaction, alleging it would give Nvidia unlawful control over computing technology and designs that rivals need to develop their own competing chips.
SoftBank stands to pocket a $1.25 billion breakup fee from the failed transaction with Nvidia, the person said. The Financial Times earlier reported the deal had fallen through.
This isn’t the first time regulators have upended a massive chip deal. The U.S., in 2018, derailed Broadcom Inc.’s attempted $117 billion takeover of another chip giant, Qualcomm Inc., on national-security grounds. Qualcomm’s $44 billion purchase of Dutch chip maker NXP Semiconductors NV fell apart in 2018 when China failed to give its regulatory approval.