Nvidia has dropped its plan to buy Arm for $40 billion, according to SoftBank, the parent company of Arm.
Nvidia will pay $1.25 billion to SoftBank for failing to complete the deal, and Arm CEO Simon Segars is stepping down in order to be replaced by Arm’s head of IP Rene Haas, who previously led Nvidia’s own Arm division.
“[Segars] has decided that at this stage of his career, the time and energy required to take the company public and everything around that was not something he wanted to sign up to… So he’s going to step down. I’m going to take over for him.”
-Arm’s head of IP Rene Haas
The industry’s biggest deal going to collapse: Nvidia & Arm
Nvidia’s acquisition of ARM, announced in September 2020, would have been one of the industry’s largest ever. The processor architecture and intellectual property at the heart of practically every smartphone and tablet chip ever made, as well as a growing number of server chips, would have fallen into Nvidia’s hands. (Apple’s Arm laptop chips impressed the industry in late 2020, scaring other manufacturers.)
The agreement has been under scrutiny practically as soon as it was unveiled, with Nvidia CEO Jensen Huang frequently having to defend it in public and finally acknowledging that it may take longer than expected. The merger of Silicon Valley’s Nvidia and British firm Arm has been beset with obstacles, according to reports from just two weeks ago. UK, EU, and US regulators were concerned about what Nvidia would do if it acquired Arm because of regulatory constraints.
The FTC also sued to prevent the deal.