Korea to intervene in Nvidia-ARM merger process
Nvidia's booth at the Electronic Entertainment Expo (E3 2017) in Los Angeles, California in 2017. Reuters-Yonhap
By Kim Yoo-chul
The country's top anti-trust regulator said Wednesday that it will review the proposed merger between Nvidia and British chip designer ARM Holdings, as the approval of the proposal may hurt fair market competition.
“Regarding issues over Nvidia's planned acquisition of ARM, we will conduct a thorough review to assess its implications from a fair market competition standpoint,” the Korea Fair Trade Commission (KFTC) said. Last October, Nvidia announced that it will purchase the entire stake in ARM, which is currently owned by Japan's SoftBank, for $40 billion.
Nvidia asked the KFTC to approve the proposed takeover this month. As ARM is the world's top semiconductor chip designer, the proposed takeover is subject to approval from anti-trust agencies in countries where the merged entity will possibly have an increased market presence. The takeover is being reviewed by the governments of the U.K., the U.S. and China, as well as South Korea.
“Nvidia is aiming to strengthen its artificial intelligence(AI)-oriented computing abilities through the takeover, as Nvidia will then be positioned to integrate ARM's CPU design technology into its in-house GPU technology,” the KFTC said.
A day earlier, the U.K. government said that it will examine the takeover deal from a national security perspective. Senior U.K. government officials ordered the country's anti-trust regulator to review the takeover proposal thoroughly, because the deal, if approved, could prompt ARM to possibly withdraw, raise prices or even reduce the quality of its services. ARM's technology has prolific applications, and it licenses its technology to Apple, Samsung Electronics and Huawei.
Regarding any updates on SK hynix's proposed takeover of Intel's NAND flash business, KFTC said that it will try to make a decision on that deal as quickly as possible, in order to help the chip industry move forward with its market realignment.
The SK-Intel deal was approved by the United States, with anti-trust agencies in Europe, U.K. China, Singapore and Brazil reviewing the transaction. SK agreed to acquire Intel's NAND and storage business for $9 billion. The transaction includes the NAND SSD business, the NAND component and wafer business, and the Dalian NAND memory manufacturing facility in China. Intel will retain its distinct “Optane” memory business.