Friday, April 23, 2021

"Nvidia’s $40 Billion Deal for Arm Faces U.K. National-Security Probe " (NVDA)

I'd like to own this one.
As noted over and over again, Queen Elizabeth should have put her foot down* when the parvenu Mr. Son made his bid. See last October's:
"Q&A with Steve Roddy, vice president of the machine learning group at Arm, on culling neural nets for embedded devices, competing with Nvidia and Intel, more" 


*See also:
May 2019
"SoftBank mulls IPO of $100 billion Vision Fund"
Crap. As we've said on these pages a few times, a cash crunch to force the re-listing of ARM Holdings would have been nice....


....The RCEWA should have figured out how to designate ARM as an Object of Cultural Interest pursuant to the 2002 Export Control Act.
Or something.

Oh well, the RCEWA did keep T.L Lawrence's dagger in British Hands.....

And the headline story from The Wall Street Journal, April 19:

Proposed acquisition of chip designer from SoftBank is already undergoing antitrust review

LONDON—The U.K. government is starting a national-security review of Nvidia Corp.’s NVDA +2.35% $40 billion deal to buy British chip designer Arm from SoftBank Group Corp. 9984 -0.94% , raising a new hurdle for an industry-reshaping proposal facing significant regulatory scrutiny around the world.

U.K. Digital Secretary Oliver Dowden on Monday invoked a little-used power to order the country’s antitrust agency to investigate the merger’s national-security implications and deliver a report by July 30. The secretary can eventually clear the deal, with or without conditions, or nix it.

The national-security review comes on top of the agency’s previously announced plans to investigate the deal on antitrust grounds.

The U.K. probe is the latest example of how governments around the world are increasingly tightening control over semiconductor technology, after the past year demonstrated how access to advanced microprocessors can make or break some of their biggest companies.

U.S. export controls on chip technology have jeopardized the ability of China’s Huawei Technologies Co., which was briefly the world’s top smartphone maker, to buy supplies it needs to keep making devices. A global semiconductor shortage, meanwhile, has idled assembly lines at General Motors Co. and other auto makers because today’s vehicles require so many chips.

“This has become the new colonialism,” said Hermann Hauser, co-founder of Arm’s predecessor company and vice chair of a European Union advisory council on technology. “If you have sovereignty, you can independently run your economy without running to another country for semiconductors.”

In addition to the U.K., Nvidia’s proposed acquisition of Arm is expected to face regulatory scrutiny in China, the EU and the U.S., in part because of its potential to reshape the chip industry. Nvidia is one of the world’s biggest designers of graphics chips, while Arm designs the basic blueprints for the chips in more than 95% of the world’s smartphones.

At the heart of antitrust concerns is the future of Arm’s business model, which has long been based on forging partnerships with as many companies as possible to sell high volumes of chip designs at low prices. Nvidia Chief Executive Jensen Huang has said he supports keeping this open business model, but competitors have been skeptical.

In ordering a review of the national-security implications of Nvidia’s proposed acquisition of Arm, the U.K. invoked a seldom-used power that gives it wide latitude to determine whether the merger would be in the “public interest” of the country, based on national-security grounds.

A spokesman for Nvidia said it didn’t “believe that this transaction poses any material national-security issues.” He said the company will work with British authorities on the probe. Nvidia executives expected a possible U.K. national-security review when the company agreed to buy Arm and factored that risk into what it has said is an 18-month timeline for completing the deal, a person close to Nvidia said.....