NVIDIA-Arm Deal Faces Further Delays, Could Force Arm to Consider IPO

[Peter_Brosdahl]

Image: NVIDIA



NVIDIA’s planned acquisition of Arm has encountered a delay that could place the deal in jeopardy. European regulators will be going on break today, and it has been reported they haven’t even begun reviewing the deal because NVIDIA has not submitted the required documents yet. The purchase was supposed to be completed by March 2022, but if more delays occur, an IPO could happen beforehand. Media and public responses on the sale have been mixed. Jensen Huang and Simon Segars recently sat down at The Six-Five Summit to explain the benefits of the potential merger of the two companies.









The $40 billion transaction between Nvidia and Softbank over acquisition of processor designer Arm could be delayed by the European Commission which is yet to receive all the necessary documents from the U.S. GPU giant. If the approval is delayed...

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[Uvilla]

Cold feet huh?

 

[Grimlakin]

Ohh **** I need to set some money aside if this turns into an IPO, THEN purchase the value will shoot up.

 

[Zarathustra]

Fingers crossed the Nvidia deal falls through.

It would be very bad for everyone. Except maybe Nvidia.

 

[Nanobot]

Ohh **** I need to set some money aside if this turns into an IPO, THEN purchase the value will shoot up.

Actually, IPOs typically underperform. The only ones making out will be the insiders.

 

[Grimlakin]

Actually, IPOs typically underperform. The only ones making out will be the insiders.

I disagree. If they IPO, and Nvidia STILL wants to purchase them... that would see the stock prices shoot up pretty well. So getting in early is good. Unless you can't suck down a loss... then that's a different ball game because that could happen as well.

 

[Uvilla]

Ill take 1 or 2 shares of the IPO if at all possible...
As to why NVIDIA is slow walking this, hard to know. Perhaps they are realizing then can do their goals without tossing the billions around?

 

[Brian_B]

Ill take 1 or 2 shares of the IPO if at all possible...
As to why NVIDIA is slow walking this, hard to know. Perhaps they are realizing then can do their goals without tossing the billions around?

I don't think it's nVidia slow walking it. It's the UK and EU regulators that have to approve the sale, and just took a break without even deliberating the case. They are in no hurry to see a UK company defect over to a new US owner.

That said, if it does go IPO, would there be anything stopping nVidia from still buying it hostile-takeover style? Apart from it likely costing a lot more money that nVidia may not have access to. I think the worst that could happen to nVidia at that point -- it would bypass the regulatory reviews on aquisition, but may invite anti-trust litigation after the fact... but possession is 9/10ths, and they would already have ownership -- maybe not 100%, but at least controlling or plurality stake.

 

[Nanobot]

I disagree. If they IPO, and Nvidia STILL wants to purchase them... that would see the stock prices shoot up pretty well. So getting in early is good. Unless you can't suck down a loss... then that's a different ball game because that could happen as well.

Nvidia still wanting to purchase them will be known to insiders/underwriters and so will be factored into the valuation. The only potential bump will come from retail investors and that will be muted as ARM isn’t susceptible to pumping (not a meme, no short squeeze, likely high institutional investors %, etc.). There are better plays in the tech space, Nvidia being one of them - even if they don’t acquire ARM.

 

[Zarathustra]

I disagree. If they IPO, and Nvidia STILL wants to purchase them... that would see the stock prices shoot up pretty well. So getting in early is good. Unless you can't suck down a loss... then that's a different ball game because that could happen as well.

As I see it, there are really only two reasons for Nvidia to get cold feet right now.

1.) Their funding for the acquisition is not solid.
2.) They fear the merger being blocked by regulatory agencies.

If either of these are true, they would still be true after a potential ARM Holdings IPO.