NVIDIA’s proposed acquisition of British semiconductor and software design darling Arm Ltd. has hit a potential speed bump, as the UK government announced today that it’d be intervening in the sale on national security grounds. The Competition and Markets Authority, UK’s competition regulator, is already preparing a report on the “competition and national security aspects of the proposed transaction,” which will presumably contain arguments as to why NVIDIA’s acquisition of Arm is bad for the country and/or overall industry. NVIDIA announced that it had entered into an agreement to purchase Arm Ltd. from SoftBank Group on September 13, 2020 in a deal valued at approximately $40 billion.
Under the powers set out in the Enterprise Act 2002, the Secretary of State for Digital, Culture, Media and Sport is able to intervene on national security grounds. This responsibility is discharged in a quasi-judicial capacity. On 19 April 2021, the Secretary of State issued a public interest intervention notice (PIIN), confirming that he is intervening in the sale on national security grounds. In reaching this decision, he considered advice received from officials across the investment security community.