The UK government will look at the national security implications of the purchase of UK chip designer ARM Holdings by US group Nvidia (NVDA.O), she said Monday, questioning the $ 40 billion deal.
Digital Minister Oliver Dowden said Monday that he had issued a so-called “intervention notice” regarding the sale of ARM by Japan’s SoftBank (9984.T) to Nvidia.
“As a next step, and to help me gather the relevant information, the UK’s independent competition authority will now prepare a report on the implications of the transaction that will assist in any further decisions,” he said.
Nvidia said it did not believe the deal posed material national security problems.
“We will continue to work closely with the UK authorities, as we have done since the announcement of this deal,” said Nvidia, the largest US chip company by market capitalization.
ARM is a major player in global semiconductors, a sector fundamental to technologies from artificial intelligence and quantum computing to 5G telecom networks.
Semiconductors also support Britain’s critical national infrastructure and are part of defense and national security technologies, the government said, adding that officials from the security community had informed the decision to intervene.
The Competition and Markets Authority will assess the competition, jurisdiction and national security effects of the deal, with a report due July 30, the government said.
Dowden will then decide whether to approve the deal, with or without commitments from the companies involved, or refer him for a longer, in-depth investigation.
The acquisition, announced in September, will bring critical deliveries to multiple silicon chip manufacturers under the control of a single player.
Founded and still based in Cambridge, England, ARM does not make chips but has created an instruction set architecture on which to base computational core designs.
The chip designs and technology have been licensed to customers such as Qualcomm Inc (QCOM.O), Apple (AAPL.O) and Samsung Electronics Co Ltd (005930.KS).
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