The US Chamber of Commerce (FTC) voted unanimously Thursday night to file a lawsuit against the acquisition of British chip giant ARM by Anvidia for $ 40 billion. According to her, the deal could harm the delicate fabric of competition between the chip companies and give Anvidia illegal control over chip design and development technology that its competitors also need.
The Chamber of Commerce further argued in the lawsuit that if the deal had been approved, the merged company might have stifled innovation in the field of advanced chips that underlie sophisticated computing equipment such as server farms and in-vehicle autonomous systems. This is the first antitrust decision made by the new Chamber of Commerce in the era of the new chairwoman, Lina Kahn, who is known for her rigid attitudes towards the technology giants.
The decision not only stops Envidia’s positive momentum that currently dominates the artificial intelligence, graphics processing and server farm market. It is also a severe blow to the Softbank fund that acquired Aram five years ago for $ 32 billion and hoped not only for a flood of value in the merger deal, but also for a significant holding in shares of Anvidia, whose shares have grown by 1,300% in the past five years.
Anvidia warned its investors a few days ago that if the deal is canceled, it could lose $ 1.25 billion paid as a down payment to Aram shareholders and non-refundable for cancellation of the deal.
Acquiring Aram will impair its neutrality
Aram was founded 21 years ago in the UK as a company that enables electronics giants to design low-power smart chips for end devices and independently. It has allowed companies like Apple, AMD, Broadcom and Qualcomm to develop their own chips, not based on Intel’s classic x86 architecture.
Initially, Aram increased its competition in the mobile processor market, but today it controls 90% of it. The most recent example of its critical role in the industry is Apple’s decision to completely abandon the use of Intel chips in its Macs by developing processors based on Aram’s architectures. Aram’s possible identification with Anvidia, which is in fact a competitor of AMD, Qualcomm and of course Intel, could have undermined the neutrality of the British chip company.
Authorities in the UK have also conducted a comprehensive investigation of the deal for fear of violating competition conditions as well as for fear of reducing the number of jobs by the company in the country.