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Nvidia Acquires Chip Maker ARM in Landmark $40 Billion Deal

David Paul

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Nvidia

ARM’s owner, Japan-based SoftBank, struck the deal, but critics are concerned whether Nvidia will retain ARM’s UK headquarters.

Tech giant Nvidia has announced the acquisition of chip manufacturer ARM in a $40 billion (£31bn) deal that it says will create “the premier computing company for the age of artificial intelligence”.

Nvidia’s purchase will allow the firm to combine its artificial intelligence (AI) computing platform with ARM’s chips to accelerate innovation while expanding into larger, high-growth markets.

It looks likely that Nvidia will gain full control of ARM, though the transaction does not include ARM’s IoT Services Group, which the company’s owner SoftBank will retain.

Commenting on the acquisition, Nvidia founder and CEO, Jensen Huang, said: “AI is the most powerful technology force of our time and has launched a new wave of computing.

“In the years ahead, trillions of computers running AI will create a new internet-of-things that is thousands of times larger than today’s internet-of-people. Our combination will create a company fabulously positioned for the age of AI.”

Huang added: “Simon Segars and his team at ARM have built an extraordinary company that is contributing to nearly every technology market in the world. Uniting Nvidia’s AI computing capabilities with the vast ecosystem of Arm’s CPU, we can advance computing from the cloud, smartphones, PCs, self-driving cars and robotics, to edge IoT, and expand AI computing to every corner of the globe.

“This combination has tremendous benefits for both companies, our customers, and the industry. For Arm’s ecosystem, the combination will turbocharge Arm’s R&D capacity and expand its IP portfolio with Nvidia’s world-leading GPU and AI technology.”

There has been some criticism of the sale, with MP’s in Westminster apparently concerned about Nvidia retaining ARM’s base in the UK.

Labour MP’s including former leader Ed Miliband said that the government should seek “legally binding assurances” that Nvidia would not move ARM’s headquarters out of Britain.

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In a statement, Miliband said: “ARM is a major British success story, but the government is doing nothing in the face of the risk of the company being swallowed up by Nvidia.

“If the government truly believes in an active industrial policy, it cannot be right that they are ignoring the potential consequences of this takeover – including the possible implications for where the company is headquartered and the thousands of jobs in Britain that depend on it.”

A spokesman for the UK Government said: “While proposed acquisitions are primarily a commercial matter for the parties concerned, the government monitors these closely.

“Where we feel a takeover may represent a threat to the UK, the government will not hesitate to investigate the matter further, which could lead to conditions on the deal.”

The move could also have deeper repercussions in Scotland after the recent announcement of job losses at their Glasgow base.

According to reports in The Herald last week, ARM had told staff that up to 21 roles at its city centre site could be at risk.

ARM said at the time that the redundancies were due to the separation of its IoT Services Group (ISG) businesses, Internet of Things Platform and Treasure Data, to new entities owned and operated by SoftBank, leaving ARM to “deepen its focus on its core semiconductor IP business”.

David Paul

Staff Writer, DIGIT

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