US sues to block chipmaker Nvidia’s US$40 bil merger with UK’s Arm

[superadmin]

WASHINGTON – United States regulators filed a lawsuit yesterday to block the US$40 billion (RM169.4 billion) merger of graphics chip star Nvidia with mobile chip technology powerhouse Arm Ltd, fearing it would undermine competition.

The move comes as US President Joe Biden strives to ramp up domestic chip production to ease the American industry’s reliance on imports.

“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 Federal Trade Commission said in a release, calling chips “critical infrastructure”.

The world faces a global shortage of semiconductors, choking production of a wide range of products including automobiles, sending new and used car prices surging.

FTC echoed concerns expressed about the merger by regulators in the United Kingdom, who recently ordered an in-depth probe of the takeover.

Digital Secretary Nadine Dorries last month asked the Competition and Markets Authority (CMA) regulator for a Phase Two probe into the acquisition, according to the British government.

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