The UK government has intervened in Nvidia’s $40bn takeover of Arm, citing national security concerns.
The Public Interest Intervention Notice was issued today (19 April) by digital secretary Oliver Dowden from the UK’s Department for Digital, Culture, Media and Sport.
It said that Dowden “is intervening in the sale on national security grounds”, though the notice did not provide any other specific details. It added that he considered advice received from officials across the investment security community.
“As a next step and to help me gather the relevant information, the UK’s independent competition authority will now prepare a report on the implications of the transaction, which will help inform any further decisions,” Dowden said in a statement.
“We want to support our thriving UK tech industry and welcome foreign investment, but it is appropriate that we properly consider the national security implications of a transaction like this.”
Nvidia, in a statement to CNBC, said that it does not believe the deal “poses any material national security issues” and that it will work with the government on moving forward.
Nvidia’s proposed deal to acquire Cambridge-based chip designer Arm from Japan’s Softbank for $40bn has been subject to much debate, with critics concerned that Arm will move from one non-British owner to another and dwindle Arm’s importance.
Founded in 1990, Arm has been a crown jewel of Britain’s tech industry, designing and licensing technology used by Apple, Samsung and Qualcomm.
In 2016, Japanese tech giant Softbank purchased Arm for around $32bn but opted to sell the firm in 2020.
Under the deal proposed last September, the Cambridge-based company would be controlled by Nvidia, which said it was committed to maintaining operations in the UK. It also announced the opening of an AI research centre in Cambridge last year.
In a public letter in November, Nvidia chief executive Jensen Huang said: “Arm will remain, as it is today, based in Cambridge, its intellectual property registered in the UK, employing some of the world’s greatest minds.”
The move by the UK government come just a few days after Huang said in an interview with VentureBeat that he expects the deal to close in 2022 ,but a spanner has now been thrown in the works.
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