Update: Deal between Nvidia and Arm does not go through, Arm prepares IPO

poor nvidia

Nvidia’s acquisition of Arm has been called off. Softbank, current owner of Arm, will receive $1.25 billion in compensation from Nvidia for not completing the transaction.

Nvidia’s acquisition of Arm is not going ahead. That was previously leaked by three sources with “direct knowledge of the transaction” via the Financial Times, and is now confirmed by Arm owner Softbank. The 40 billion megadeal is thus history. Softbank still wants to get rid of Arm and is now preparing an IPO. That is scheduled for no later than March 31, 2023.

Softbank will receive $1.25 billion from Nvidia. The company made that amount when signing the acquisition agreement and will not be repaid. Arm CEO Simon Segars would lose his job according to Financial Times, Rene Hass (ironically ex-Nvidia) will be his successor.

Long road to nowhere

In September 2020, Nvidia announced the acquisition of UK-based Arm for $40 billion. We wrote back then that the chip world would never be the same again, but that’s not how it came to pass. A month later, the UK was already looking at a blockage of Arm sales, and over the past year Nvidia and Arm have regularly had to defend themselves against a lot of negative press.

In addition to problems surrounding UK approval, European approval was also delayed in mid-July 2021. Not much later, it would become clear that the deal’s March 2022 deadline was becoming unachievable. Late last year, the UK and the European Commission announced new investigations and the US competition watchdog also turned against the takeover.

Just last month, Arm stressed that it would be in a bad competitive position if the acquisition does not go through, but it now seems that the deal is definitely off. At the end of January there was already talk of preparation for the abandonment, and today comes the new rumor that the takeover has definitely fallen through.

Earlier this year, we launched a survey on how important ARM architecture will become in the coming years and the importance of independence. Read our full report here.

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Update: Deal between Nvidia and Arm does not go through, Arm prepares IPO