Nadine Dorries orders deeper probe into Nvidia takeover of UK chip designer Arm

The Culture Secretary said the security implications of the purchase required further investigation.

Jamie Harris
Tuesday 16 November 2021 14:34
Nadine Dorries has ordered a second investigation into the takeover of chip maker Arm by Nvidia (Steve Parsons/PA)
Nadine Dorries has ordered a second investigation into the takeover of chip maker Arm by Nvidia (Steve Parsons/PA)

The Digital Secretary has ordered a deeper investigation into the multibillion-pound purchase of UK computer chip designer Arm by US tech giant Nvidia over competition and national security concerns.

Nadine Dorries has written to the competition regulator instructing them to do an in-depth Phase Two probe of the proposed acquisition.

The Competition and Markets Authority (CMA) had already raised fears over the 40 billion dollar (£31.2 billion) deal, saying in August the merger might restrict the access Nvidia’s rivals have to Arm’s technology, which is used by firms in making semiconductor chips and other products.

Its first investigation, ordered by previous Digital Secretary Oliver Dowden found the transaction raises the possibility of a “substantial lessening of competition across four key markets”. The markets being: data centres, Internet of Things, the automotive sector and gaming applications.

Ms Dorries said: “I have carefully considered the Competition and Markets Authority’s Phase One report into Nvidia’s proposed takeover of Arm and have decided to ask them to undertake a further in-depth Phase Two investigation.

“Arm has a unique place in the global technology supply chain and we must make sure the implications of this transaction are fully considered.

“The CMA will now report to me on competition and national security grounds and provide advice on the next steps.

“The Government’s commitment to our thriving tech sector is unwavering and we welcome foreign investment, but it is right that we fully consider the implications of this transaction.”

Oliver Dowden has ordered the competition watchdog to begin a ‘phase one’ investigation of the deal (Arm/Nvidia)

When the deal was first announced last September, Nvidia pledged to keep Arm’s headquarters in Cambridge while also promising to expand on Arm’s work to build a “world-class” technology centre.

The company is best known as the designer of processor chips used in most major smartphones, including Apple and Samsung, as well as other devices such as laptops.

A spokesperson for Nvidia said: “We plan on addressing the CMA’s initial views on the impact of the transaction on competition, and we will continue to work with the UK Government to resolve its concerns.

“The Phase 2 process will enable us to demonstrate that the transaction will help to accelerate Arm and boost competition and innovation, including in the UK.”

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