Global semiconductor companies are trying to reshape their business by M&A. At the same time, various countries are becoming increasingly strict about such attempts in order to strengthen their supply chains and protect themselves from the ongoing global chip shortage.
Reuters reported on Aug. 29 that the European Union is going to look into Nvidia’s attempt to acquire ARM. According to the news report, Nvidia will request an antitrust approval from the European Union early next month, the regulatory authorities will initiate a preliminary review, and then the probe will follow.
Nvidia announced in September last year that it would acquire ARM from SoftBank, the largest shareholder in the U.K. company. The acquisition process was planned to be completed by March next year, but the process may take more time as various governments are calling for more time. The competition authorities of the United Kingdom recently said that the acquisition may considerably hinder market competition and it would look deeper into the matter. In addition, the European Union is likely to follow suit and Google and Qualcomm already expressed their objection right after the announcement last year.
In fact, a number of deals have already been thwarted by competition authorities. In March this year, the Italian government vetoed Shenzhen Investment Holdings’ purchase of LPE, a Milan-based semiconductor company. More recently, Nexperia, a Dutch semiconductor company owned by Chinese company Wingtech, acquired U.K.-based Newport Wafer Fab, and then a U.S. semiconductor startup cut business relations with it.
China has objected to such deals between the United States and Europe as well. It scuttled the Qualcomm-NXP deal in 2018 and the Applied Materials-Kokusai Electric deal in 2019. At present, the Chinese government is looking into M&A between SK Hynix and Intel’s NAND unit and between AMD and Xilinx.