Nvidia: Self-driving "Big Mac" dream shattered?

Dreaming of chip "Big Mac", I woke up completely.

Text/Shanshan Xu

Huang Jenxun must have imagined countless times in his mind how exciting and convincing the scene when NVIDIA successfully acquired Arm should be. Unfortunately, such a "new benchmark for acquisitions" seems to be difficult to achieve.

It's hard

Recently, Bloomberg quoted people familiar with the matter as saying that under the premise that there is no progress in the above transaction, Nvidia is ready to give up the acquisition of Arm from SoftBank Group.

On the one hand, Nvidia has informed its partners that it does not expect to be able to complete the transaction; on the other hand, SoftBank Group is accelerating the pace of Arm's listing.

What really disappointed Huang was that regulators around the world had been slow to approve Nvidia's acquisition of Arm, even though he had repeatedly promised in public that he would not monopolize Arm because he had included it.

Arm's IP is almost ubiquitous, from automotive connectivity technology and in-vehicle infotainment systems to advanced driver assistance (ADAS) and autonomous driving systems.

Especially in the unpredictable international environment and the development trend of "software-defined vehicles", Arm's status is no different from that of "strategic materials".

But there are currently indications that the hefty $40 billion acquisition may still be stillborn.

Momomo

From formal public takeover offers to running into walls everywhere and not getting approval from Regulators in China, the United States, the European Union and the United Kingdom, NVIDIA's "chip giant" ambitions have been frustrated.

Nvidia had expected the deal to take about 18 months to close, taking ownership of Arm from SoftBank in March.

However, as can be seen from the following timeline, Nvidia is "pushed step by step", although in the 28-page document submitted to the UK Competition and Markets Authority (CMA), Nvidia "knows what it is like to move with reason", and it is still useless.

In August 2020, it was announced that SoftBank would sell Arm

In September 2020, Nvidia announced the acquisition of UK IP provider Arm for $40 billion

October 2020 Tech giants including Google, Qualcomm and Huawei objected

In August 2021, Tesla CEO Musk expressed concern about this, and Samsung and others expressed their opposition

In October 2021, the European Union announced an in-depth investigation into the transaction

November 2021 Nvidia received a notice of review from a UK regulator

December 2021 The U.S. Federal Trade Commission (FTC) filed a lawsuit against the transaction on antitrust grounds

January 2022 It is rumored that Nvidia is ready to abandon the acquisition

The FTC made it clear that NVIDIA's acquisition of Arm could have a negative impact on the competition in the three major markets such as automotive ADAS. These areas are NVIDIA's target markets.

Huang Renxun is indefensible, after all, Arm's customers are all over the world, naturally including its competitors, and no one wants to become a strong enemy who stands against himself. Although both Nvidia and SoftBank have not completely abandoned, the acquisition may end up as fruitless as Qualcomm's acquisition of NXP.

Perhaps, in this acquisition, there is only one loser.

Because even if the deal fails, SoftBank will still be able to retain the $2 billion it paid when Nvidia originally signed the agreement, and Arm's reputation will be launched, which is expected to increase the IPO valuation. In the end, only Nvidia will leave the scene.