Jen-Hsun Huang, President and Chief Executive Officer of Nvidia Corp., speaks during the company’s event at Mobile World Congress Americas in Los Angeles on Oct. 21, 2019.
Patrick T. Fallon | Bloomberg |bergGetty Images
US chip giant Broadcom has backed Nvidia’s $40 billion acquisition of chip designer Arm in the UK. After other companies expressed concern about the deal.
The deal, which was announced last September. It is being scrutinized by antitrust regulators in the United States, Europe, China and the United Kingdom. Competitor Qualcomm has said Nvidia could limit the supply of Arm̵7;s technology to competitors or raise prices. Google and Microsoft have raised concerns as well. with regulators, according to Bloomberg.
But Broadcom chairman and chief executive Hock Tan said in a joint statement with CNBC that his company was backing the deal after receiving the necessary approvals.
“Arm is Broadcom’s primary partner, and access to technology is critical to our success now and in the future,” Tan said.
“Broadcom encouraged Nvidia to make an acquisition of Arm because Nvidia reassures the industry that it will increase its overall investment in Arm’s technology and will make it available to the industry in a fair, reasonable and non-discriminatory manner.”
Elsewhere, MediaTek and Marvell expressed their support, according to a report from The Sunday Times over the weekend.
Rick Tsai, head of Taiwan’s MediaTek, the world’s largest developer of mobile chips, said the semiconductor industry. “It will benefit from the combination of Nvidia and Arm,” according to the report.
“We believe the merger will help MediaTek and other industry participants bring more competitive and inclusive products to market,” said Tsai.
Marvell CEO Matt Murphy told The Sunday Times he didn’t see it. “Any reluctance from Nvidia to resolve” concerns raised by Qualcomm and others.
MediaTek and Marvell did not immediately respond to CNBC’s request for comment.
In a rare joint interview that aired June 17, Nvidia CEO Jensen Wang and Arm CEO Simon Segars tried to explain why the deal should go ahead. They are trying to address concerns about Arm’s loss of independence, as well as those related to export controls and digital sovereignty.
Segars said Arm was struggling to meet demand due to its limited resources. “Right now we are looking at everything we can do in a day,” he said. “We just have more ways to do than people have to. That was always like that, but now it’s more than ever.”
“Products The things that our licensees want to build are growing and growing,” Segars added. “What they are asking for from us is increasing and increasing due to the increasing complexity. There is no way we can do it on our own.”
Huang said it was important to note that “Independence is not equal to strength”
The geopolitical impact?
Broadcom, MediaTek and Marvell were among the first chip companies. that came out in support of this agreement This comes amid a major global chip shortage. This could last until 2023.
Graphcore CEO Nigel Toon told CNBC in December that his company viewed the deal as anti-competitive. “It runs the risk of shutting down or restricting the access of other companies to the design of top-of-the-line CPU processors, which are very important in the tech world. From data centers, mobile phones, cars and in all kinds of embedded devices,” he said.
Chinese chipmakers, including Huawei, have urged Beijing to try to block the deal, fearing they would be at a disadvantage if Arm falls into the hands of US firms.
Arm is currently owned by SoftBank after the Japanese tech giant paid 24 billion pounds ($33 billion) for the company in 2016.