Nvidia CEO Jensen Huang speaks during a press conference at The MGM during CES 2018 in Las Vegas on January 7, 2018.
Mandel Ngan | AFP | Getty Images
The European Commission, the European Union’s executive arm, has launched an “in-depth investigation” into Nvidia’s acquisition of UK chip designer Arm, now owned by SoftBank. Nvidia announced over a year ago that it wanted to buy Arm for $40 billion.
The investigation, announced by the Commission on Wednesday, is the latest setback for chip companies that have already said the deal is unlikely to be completed before the initial March 2022 deadline.
The Commission said it was concerned that the merger could limit access to “neutral” Arm chip designs and that it could lead to higher prices, fewer options and less innovation in the semiconductor industry.
“While Arm and Nvidia do not compete directly, Arm’s IP is an important input into products that compete with Nvidia’s products, for example in data centers, automobiles and the Internet of Things,” Executive Vice President Margaret Vestager said in a statement.
“Our analysis shows that Nvidia’s acquisition of Arm could lead to restricted or degraded access to Arm’s IP, with distorting effects in many markets where semiconductors are used,” she added.
The acquisition is also under scrutiny by regulators in the US, UK and China.
“We are working closely with the European Commission through the regulatory process,” an Nvidia spokesperson told CNBC.
“We look forward to the opportunity to address their initial concerns and continue to demonstrate that the deal will help accelerate armaments and promote competition and innovation, including in the European Union.”