FTC Sues To Block $40Bln Merger Of US Chipmaker Nvidia With UK's Arm Ltd
Sumaira FH Published December 03, 2021 | 02:40 AM
WASHINGTON (UrduPoint News / Sputnik - 03rd December, 2021) The US Federal Trade Commission said on Thursday that it was suing to block a $40 billion merger of US chipmaker Nvidia and UK chip design provider Arm Ltd, saying the combined firm would have the means and incentive to stifle innovative next-generation technologies.
"The FTC is suing to block the largest semiconductor chip merger in history to prevent a chip conglomerate from stifling the innovation pipeline for next-generation technologies," Holly Vedova, director of the bureau of competition within the trade commission, said in a statement on Thursday. "This proposed deal would distort Arm's incentives in chip markets and allow the combined firm to unfairly undermine Nvidia's rivals."
The FTC complaint specifically centers on the dominance the combined firm would have on technologies that are used to run data centers and driver-assistance systems in cars.
"Semiconductor chips power the computers and technologies that are essential to our modern economy and society," the statement said.
"The proposed vertical deal would give one of the largest chip companies control over the computing technology and designs that rival firms rely on to develop their own competing chips."
The FTC noted that the California-based Nvidia was one of the world's largest and most valuable computing companies. It said Nvidia develops and markets computer chips and devices used widely for artificial intelligence processing and graphics processing.
The firm also develops and markets products for advanced networking, datacenter central processing units and computer-assisted driving. In these areas, both Nvidia and important competitors to Nvidia rely on Arm's technology to develop their own competing products, the statement said.
Arm, owned by Tokyo-based Softbank Group Corp, creates and licenses microprocessor designs and architectures that other technology companies rely on to make their own chips, the statement added.
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