Nvidia falls 5% as chipmaker touts Arm deal benefits
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Nvidia (NASDAQ:NVDA)
shares fell 5%, Monday, as the graphics chipmaker made its latest arguments in support of its efforts to get British regulatory approval for its proposed $40 billion acquisition of Arm Holdings.
In a UK filing on Monday, Nvidia (NVDA) said it was originally approached by Arm's owner, SoftBank, about a possible deal. Nvidia said the proposed tie-up "represents a unique, once-in-a-generation opportunity to expand and enhance Armâs ecosystem in critical markets." Nvidia has faced regulatory inquiries about whether acquiring Arm would lead to a restriction in competition in the chip market, especially in the graphics and central processing unit sectors.

But, Nvidia (NVDA) said that with regard to the PC market, it's in Arm's best interests to join with Nvidia due to the size of the sector's leading chipmakers.
"Intel and AMD are the industry leaders, not also-rans," Nvidia said, in its latest filing. "Intel and AMDâs CPUs are not going anywhere, and they will compete with Arm for the foreseeable future. With or without the transaction, Arm cannot foreclose competition."
Nvidia (NVDA) said that even if it could squeeze out competitors, doing so wouldn't be in the combined company's best interests.
"Rather, the merged entity would have every incentive to do exactly what Nvidia has repeatedly pledged: increase Armâs R&D, grow the ecosystem, and license all existing and prospective customers without discrimination."
Nvidia (NVDA) originally announced its intention to acquire Arm in September 2020. However, the deal has been hamstrung by governmental antitrust concerns in both the U.S. and the U.K. In December 2021, the U.S. Federal Trade Commission sued to block the acquisition, and the antitrust chief for the European Union also said she was "deeply concerned" about the implications of the deal.
On Monday, Bank of America analyst Vivek Arya called Nvidia (NVDA) his top semiconductor pick for 2022.