After pressure from regulatory agencies around the world concerned about chip industry dominance by one company, Nvidia caved and called off its move to buy the world’s largest semiconductor designer.
Graphics chipmaker Nvidia has announced it’s dropping plans to buy chip designer Arm from SoftBank Group Corp. for $40 billion after regulators pushed back over antitrust concerns. In a joint statement issued today, US-based Nvidia and Japan-based Softbank said they terminated the agreement they’d been working on since September 2020 because of “significant regulatory challenges.” The buyout would have been the chip industry’s largest ever and had raised red flags almost as soon as it was announced. Softbank, a Tokyo-based multinational holding company and investment firm, instead said it is now preparing to go public with Arm. Softbank said it expects the public offering to take place during the fiscal year that ends March 31, 2023. No details of the IPO have yet been announced. “Arm is becoming a center of innovation, not only in the mobile phone revolution, but also in cloud computing, automotive, the Internet of Things and the metaverse, and has entered its second growth phase,” said Masayoshi Son, chairman & CEO of SoftBank. “We will take this opportunity and start preparing to take Arm public, and to make even further progress.” Before agreeing to sell Arm to Nvidia, SoftBank had been considering going public with its chip designer subsidiary. The deal to sell Arm came on the heels of two big industry swings. In 2020, Nvidia overtook Intel Corp. as America’s most valuable semiconductor company by market value. In recent years, Nvidia has experienced tremendous growth in markets such as artificial intelligence and high-performance computing.
