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F.T.C. Sues to Stop Blockbuster Chip Deal Between Nvidia and Arm

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WASHINGTON — The Federal Trade Commission on Thursday sued to block Nvidia’s $40 billion acquisition of a fellow chip company, Arm, halting one of the biggest semiconductor industry deals in history.

The F.T.C. said the deal between Nvidia, which is based in California and makes chips, and Arm, a British company that designs chips, would stifle competition and harm consumers. The proposed deal would give Nvidia control over computing technology and designs that rival firms rely on to develop competing chips.

“Tomorrow’s technologies depend on preserving today’s competitive, cutting-edge chip markets,” said Holly Vedova, the director of the F.T.C.’s competition bureau. “This proposed deal would distort Arm’s incentives in chip markets and allow the combined firm to unfairly undermine Nvidia’s rivals.”

The companies announced the merger in September 2020 and said the merger would position the companies as leaders in semiconductors for artificial intelligence.

This breaking news story will be updated.

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