The purchase of ARM by Nvidia will not have the outcome that both parties expected . Bloomberg assures that the North American company is warning its partners that they do not expect the operation to be completed successfully and that Softbank, in parallel, would be preparing the company's IPO.
Nvidia, let's remember, announced the purchase of ARM in September 2020, almost a year and a half ago. The amount announced at that time was 40,000 million dollars, which would have made this operation one of the largest in history.
The purchase, however, has never been viewed favorably by the regulatory bodies of the different regions or by the industry players that collaborate with ARM. This situation has hindered its completion, which caused skepticism from the first moment due to its possible implications.
The purchase of ARM by Nvidia caused skepticism from the first moment
The company of British origin is one of the pillars of the semiconductor industry. A pillar, moreover, neutral, since ARM has always been an independent company. This attribute gave all the partners –including Apple, Qualcomm or Samsung, among many others– the confidence that they would all be treated fairly and that the future of their semiconductors would not be in the hands of a rival company.
However, if Nvidia's purchase of ARM went ahead, the game board would turn 180 degrees, since that neutral actor on which so many companies depend would be in the hands of a company that also competes in the semiconductor market. . A risk of imbalance that neither the regulators nor the companies participating in the semiconductor industry liked.
Another factor to consider is geopolitics. If Nvidia acquired ARM, the company would become subject to North American regulation. A fact that in countries like China would not be well received, since many of its technology companies, as in other regions of the world, depend on ARM. The climate of tension between the aforementioned country and the United States, moreover, would not facilitate the situation.
At the moment, neither of the two companies has confirmed the news, but the outlook is bleak considering the important role that ARM has in the industry. Nvidia has tried to convince regulators that the purchase will not alter current dynamics in the semiconductor industry. However, skepticism remains the dominant tone even in the United States, Nvidia's home country, where the FTC branded the operation anti-competitive.
