The $40 billion acquisition of processor designer Arm between Nvidia and SoftBank may be delayed by the European Commission, which has not yet received all necessary documents from the US GPU giant. If approval is significantly delayed, Arm will be forced to consider an IPO.
A source familiar with the Nvidia-Arm transaction told Telegraph If delays and obstacles from competitors prove invincible, then IPO is still an option for Arm.
The European Commission, including the competition regulator, will start its summer vacation on Monday, July 26. So far, the European Commission has not even begun to review NVIDIA’s acquisition of Arm, because the former has not yet submitted the required documents to European regulators. The European Commission will resume work in early September.
Nvidia is very interested in completing this transaction because it will make it a developer of highly integrated data centers and client platforms that include CPUs, GPUs and DPUs (data processing units). SoftBank is also interested in selling Arm to Nvidia because it will make it a major shareholder of the company. Arm’s management is also interested in becoming part of Nvidia, as this will help it avoid an IPO and focus on R&D rather than short-term profitability.
Considering that everyone is interested in this transaction, it is very surprising that Nvidia has not submitted the appropriate documents to the EC.Nvidia and SoftBank have not commented on this story Telegraph.
Assuming that Nvidia submits an application to the EC before September, it will take six months or more for the committee to review the transaction and its impact on competition. In the best case, the European Commission will approve the acquisition by March 2022. However, experts say that the best scenario is unlikely to happen.
Jonathan Branton, the head of the competition law firm DWF, said: “No regulatory agency will allow itself to be pushed into desperation and have to make a decision within a time frame that it is not satisfied with.”
In September last year, when Nvidia announced its intention to acquire Arm from SoftBank in a cash and stock transaction of US$40 billion, it stated that the transaction would be completed within 18 months, that is, by March 2022, with an option to extend to September 2022. moon. , Nvidia has not yet obtained the approval of the US, UK, Japan and Chinese regulatory agencies. The European Commission has not even begun to review the transaction.