Business & Investment

£ 60bn Weapon Bid Collapses: Ministers Promote London Listing

If Nvidia’s acquisition of the company collapses, the UK will need to deploy Arm’s red carpet

Withdrawal: Kwasi Kwaten Business Secretary

According to Whitehall sources, the UK needs to roll out Arm’s red carpet in case the acquisition by Nvidia collapses.

The deal seems more likely to fail after the Federal Trade Commission (FTC) has moved to thwart the merger for competitive reasons.

It is also being investigated by the UK’s Competitive Markets Authority while the European Commission is initiating its own investigation.

The intervention means that the acquisition is behind schedule and will not be completed by the March 2022 target date.

If the transaction fails, the return to the London Stock Exchange is increasingly on the card.

Ministers, including Secretary of Commerce Kwasi Kwaten, are understood to welcome the listing of Arm in London.

Whitehole sources said: The competitive concerns surrounding selling to Nvidia mean that this is very difficult.

“It’s different from dealing with Softbank [when the Japanese conglomerate bought Arm, then listed on the stock market, in 2016]..

“The London Stock Exchange should be preparing to roll out the red carpet for Arm.”

LSE is about to become a world-class technology hub, and ensuring Arm returns can give the market the credibility you really need.

London is a fascinating capital and has over 100 IPOs this year. We get people to talk to businesses and educate them about their choices and how they do it.

But people close to the situation said SoftBank is unlikely to roll over, as the value of the transaction has almost doubled since it was announced last September.

Initially, Arm was valued at £ 30 billion, including 44 million Nvidia shares, which was worth £ 16.2 billion at the time.

However, as a result of the increase in Nvidia’s stock, that stock portion of the transaction is worth £ 43 billion.

This brings the overall value of the acquisition to £ 57 billion. Arm provides chip designs to semiconductor companies and smartphone makers, including Apple.

The company’s role in the chips industry has been a historically neutral supplier, raising concerns that Nvidia may separate its competitors from the essential Arm technology.

FTC director Holly Vedova said Watchdog is “trying to prevent the largest semiconductor chip merger in history to prevent chip conglomerates from overwhelming the innovation pipeline of next-generation technologies.”

She added: “Tomorrow’s technology depends on maintaining today’s highly competitive and cutting-edge chip market. This proposed deal distorts Arm’s incentives in the chip market, and the integrated company makes Nvidia’s rivals. It will make it possible to unreasonably weaken.


£ 60bn Weapon Bid Collapses: Ministers Promote London Listing £ 60bn Weapon Bid Collapses: Ministers Promote London Listing

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