NVIDIA recently announced that the company has agreed to acquire SoftBank-owned ARM Holdings for a whopping sum of $40 billion, making it one of the biggest acquisitions globally in the tech sector.
Now, several Chinese technology companies, including Huawei, have express concerns about the deal to local regulators, reports Bloomberg. The report adds that the companies are lobbying the regulators to either kill the deal or impose conditions to ensure access to ARM technologies to Chinese companies.
The Chinese companies fear that the deal will become yet another weapon for the United States government to cut off access to new technologies for the China-based companies as the US-China trade war intensifies.
ARM’s semiconductor designs and architecture are fundamental to several products, including smartphone processors, server chips, AI applications, and more. China could wield its power over this deal given that it is the world’s largest market for semiconductors as it imports chips worth about $300 billion annually.
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Ever since the deal between NVIDIA and ARM announced, everyone expected it to face major regulatory issues. As said, ARM’s designs and instruction make an integral element in chipsets and with NVIDIA’s presence in the chipset market, the acquisition of ARM could give it an unfair advantage over its competitors such as Qualcomm and Intel among others.
The Chinese watchdog is yet to view a formal application for approval for the deal but it is likely to face opposition in the country. While both the companies — NVIDIA and ARM have said that they are confident for the deal to go through, it could easily take more than a year to get the necessary approvals.
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