Nvidia’s huge Arm deal has just been scrapped

Graphics giant Nvidia will no longer spend $40 billion to acquire Arm, parent company SoftBank has announced announced, citing “significant regulatory challenges.” The news was first reported by the Financial Times

Nvidia will pay $1.25 billion to SoftBank for not going through the transaction, while Arm CEO Simon Segars will step down to be replaced by Arm’s head of IP Rene Haas, who happened to run Nvidia’s own Arm company many years ago. .

†[Segars] decided that at this stage in his career, the time and energy it took to get the company IPO and everything around it wasn’t something he wanted to sign up for,” said Haas. tells TechCrunch† “So he’s going to resign. I’ll take over from him.”

The deal, announced in September 2020, would have been one of the biggest ever in the industry, putting GPU maker Nvidia in control of the company whose architecture and intellectual property are key to virtually every smartphone and tablet chip ever made. , as well as a growing number of server chips and Apple’s full future product roadmap for its impressive Arm-powered laptops and desktop PCs. (Apple’s Arm laptop chips impressed the industry in late 2020, alerting other manufacturers.)

Instead, SoftBank now says Arm will pursue an IPO in the fiscal year beginning April 1, and Arm will keep its existing license to use Arm technology. Nvidia initially declined to comment on Custom Hour, not even confirming or denying that the deal fell through, but confirmed it with a press release early Tuesday morning. “Arm has a bright future and we will continue to support them as a proud licensee for decades to come,” reads part of a statement from Nvidia CEO Jensen Huang. SoftBank and Arm also did not immediately respond to requests for comment, but Arm gave his own press release on Tuesday confirmation of the management change (without mentioning Nvidia’s deal).

The deal came under scrutiny almost immediately after its announcement, with Nvidia’s Huang often having to publicly defend it, eventually admitting it could take much longer than planned. Just two weeks ago, Bloomberg reported that the deal fell through, following challenges from UK, EU and US regulators worried about what Nvidia could do if it owned Arm. The FTC has also filed a lawsuit to stop the acquisition.

Update, Feb 8, 1:30 AM ET: Added official confirmation from SoftBank.

Update, February 8, noon ET: Added additional links and Nvidia citation.

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