The British government has issued recommendations on NVIDIA’s acquisition of ARM: public interest intervention

On April 19, 2021, the UK Secretary of State issued a public interest intervention Notice confirming that it was interfering with NVIDIA’s acquisition of ARM on national security grounds.

On September 13, 2020, NVIDIA Corporation (NVIDIA) and SoftBank Group (SoftBank) announced an agreement under which NVIDIA will acquire ARM LTD. (ARM) from SoftBank in a deal valued at approximately $40 billion.

Under the terms of the deal, which has been approved by the boards of Nvidia, SoftBank and ARM, Nvidia will pay SoftBank a total of $12 billion in cash and $2.55 billion in Nvidia stock after the deal closes. In addition, SoftBank could receive up to $5bn if ARM meets certain financial performance targets. Nvidia will also issue $1.5 billion in equity to ARM employees.

Under powers under the Enterprise Act 2002, the Secretary of State for Digital, Culture, media and Sport can intervene on grounds of national security. This duty is performed in a quasi-judicial capacity.

On April 19, 2021, the UK Secretary of State issued a public interest intervention Notice confirming that it was intervening in NVIDIA’s acquisition of ARM on national security grounds, taking into account the advice of officials throughout the investment security community in its decision.

The COMPETITION and Markets Authority (CMA) will prepare a report on the competition and national security aspects of the proposed deal. The CMA has until midnight on 30 July 2021 to complete and submit this report to the Secretary of State.

Proposed acquisition of ARM Limited by NVIDIA Corporation: public interest intervention