US challenges Nvidia takeover of chip designer Arm

Image source, Getty Images

Image caption, Nvidia had hoped the deal would be completed by March 2022 but that now looks unlikely

The US Federal Trade Commission has challenged the proposed takeover of chip designer Arm by Nvidia.

The FTC said the proposed acquisition would give Nvidia too much control over computing technology that competitors rely on.

Arm licenses its designs and technology to big tech companies, including Apple, Qualcomm, Sony and Samsung.

Nvidia said it would "work to demonstrate that this transaction will benefit the industry".

The company produces high-performance graphics cards for gaming, chips for mobile computing and also develops software and artificial-intelligence systems.

Originally a British firm, Arm was sold to Japan's SoftBank in 2016.

Nvidia announced its planned takeover in September 2020, but the deal has faced scrutiny and legal challenges from regulators, including inquiries in the UK and Europe.

The US watchdog said: "The proposed merger would give Nvidia the ability and incentive to use its control of this technology to undermine its competitors, reducing competition and ultimately resulting in reduced product quality, reduced innovation, higher prices, and less choice."

Nvidia had promised to maintain Arm's open-licensing model, retain the brand, keep the company based in the UK and hire more staff.