Chipmaker Nvidia (NVDA) has officially abandoned its planned acquisition of Arm Holdings due to “significant regulatory challenges,” the company said in a news release.
The deal was originally announced in 2020 and had a value of $66 billion U.S. in Nvidia stock and cash. Japan’s SoftBank, which currently owns Arm Holdings, said it will now prepare to take Arm public within the fiscal year ending March 31, 2023.
Arm makes technology that is at the core of every smartphone processor, including Apple’s (AAPL) iPhones and Android devices running on Qualcomm (QCOM) chips. It counts nearly every major semiconductor company as a client.
The deal faced global regulatory scrutiny since it was first announced. Arm, a British company, is a neutral supplier to several competing technology giants. Qualcomm and Microsoft (MSFT) both use Arm’s main technology, its instruction set, and publicly opposed the deal.
In December, the U.S. Federal Trade Commission sued to block the transaction on antitrust grounds. Last year, British competition authorities announced a probe into the sale.
Semiconductor and technology companies feared that if Nvidia owned Arm, it could favor its own business over its clients who may not have an alternative to Arm technology.
SoftBank said the $1.25 billion U.S. deposit it had received as part of the deal is non-refundable and will be recognized as profit in the fourth quarter of the fiscal year ending March 31, 2022.
Arm was independent until 2016, when SoftBank Group bought it for $32 billion U.S. Nvidia previously said it expected the transaction to close this year.
