Acquisition ARM by Nvidia under investigation by UK antitrust authority

Nvidia officially announced it has plans to acquire CPU maker ARM for $ 40 billion from its current owner, Japan's SoftBank. Competition authorities are questioning the acquisition. In the UK, the deal is now being investigated by the Competition and Markets Authority (CMA) as the country now officially has exited the European Union.

BBC:  The CMA said it is likely to consider whether, following the takeover, Arm has an incentive to withdraw, raise prices or reduce the quality of its intellectual property licensing services to Nvidia's rivals.

"The chip technology industry is worth billions, and critical to many of the products that we use most in our everyday lives," said CMA chief executive Andrea Coscelli. "We will work closely with other competition authorities around the world to carefully consider the impact of the deal and ensure that it doesn't ultimately result in consumers facing more expensive, or lower quality, products."

Until now, the European Commission was responsible for most large and complex competition cases involving the UK. The CMA has taken over these responsibilities following the UK's departure from the European Union.

Its remit, by law, is to assess the potential impact of a merger on competition.  Nvidia has promised to keep the business based in the UK, to hire more staff, and to retain Arm's brand. It said that the deal would create "the premier computing company for the age of artificial intelligence".

And the company added: "We believe the approval process will take about 18 months from when we signed the deal. The regulatory process is confidential and we won't be providing comment on milestones along the way."

Nevertheless, the CMA has felt the need to step in, perhaps to lay down a marker now that the UK is outside the EU and it is free to flex its regulatory muscles. This, however, is very much a first step which may not lead anywhere. Nvidia will be more worried about other regulators around the world who may listen to its rivals' complaints that, by taking over what was Arm's neutral licensing platform, it will stifle competition in the chip market. China, in particular, has already made clear that it isn't happy about a deal which gives so much power to an American giant at a time when the US has sought to deny Chinese firms access to chip technology.