Jen-Hsun Huang, President and Chief Executive Officer of Nvidia Corp., speaks during the company’s event at Mobile World Congress Americas in Los Angeles on October 21, 2019.
Patrick T. Fallon | Bloomberg | Getty Images
US chip giant Broadcom has spoken out in favor of Nvidia’s acquisition of British chip designer Arm, $ 40 billion, after other companies raised concerns about the deal.
The agreement, which was announced last September, is under review by antitrust authorities in the US, Europe, China and the UK. Rival Qualcomm has said that Nvidia could limit supplies of arm tech to its competitors or raise prices. According to Bloomberg, Google and Microsoft have raised the same concerns with regulators.
But Broadcom president and CEO Hock Tan said in a statement shared with CNBC that his company will support the deal after receiving the necessary assurances.
“Arm is a critical partner for Broadcom, and access to its technology is critical to our current and future success,” said Tan.
“Broadcom supports Nvidia’s proposed acquisition of Arm because Nvidia has committed to the industry that it will increase its total investment in Arm’s technology and continue to make that technology available to the industry on a fair, reasonable and non-discriminatory basis.”
Elsewhere, MediaTek and Marvell have also expressed support, according to a report in The Sunday Times newspaper over the weekend.
Rick Tsai, head of Taiwan’s MediaTek, the world’s largest mobile chip developer, said the semiconductor industry “will benefit from the combination of Nvidia and Arm,” according to the report.
“We believe the merger will enable MediaTek and other industry participants to bring more competitive and comprehensive products to market,” said Tsai.
Marvell CEO Matt Murphy told the Sunday Times that he had not seen “Nvidia unwilling to address the concerns expressed by Qualcomm and others.”
MediaTek and Marvell did not immediately respond to a CNBC request for comment.
In a rare joint interview that aired on June 17, Nvidia CEO Jensen Huang and Arm CEO Simon Segars attempted to explain why the deal should go ahead. They tried to address concerns about Arm’s loss of independence, as well as issues of export control and digital sovereignty.
Segars said Arm is currently struggling to meet demand as the company has limited resources. “Right now we’re looking at what we can do in a day,” he said. “We just have a lot more to do than the people. It has always been like that, but at the moment it is more than ever.”
“The range of products that our licensees want to develop is growing and growing,” added Segars. “What they ask of us is increasing because of the increasing complexity. There is no way we can do it alone.”
Huang said it was important to note that “independence does not equate with strength”.
Broadcom, MediaTek and Marvell are among the first chip companies to endorse the deal, which takes place amid a major global chip shortage that could last through 2023.
Nigel Toon, CEO of Graphcore, told CNBC in December that his company viewed the deal as anti-competitive. “There is a danger that other companies will close or restrict access to the cutting-edge CPU processor designs that are so important in the entire technology world, from data centers to mobile devices to cars and in all kinds of embedded devices,” he said.
Local chipmakers in China, including Huawei, have urged Beijing to block the deal as they fear it could be at a disadvantage if Arm gets into the hands of a US company.
Arm is currently owned by SoftBank after the Japanese tech giant paid £ 24 billion ($ 33 billion) for the company in 2016.