Nvidia has officially given up on its plan to acquire fellow chip maker Arm for a record-setting $40 billion. Arm parent company, SoftBank, announced that the deal has been scrapped this week following “significant regulatory challenges”. 

The $40 billion acquisition would have been the largest in Nvidia's history. Now that the deal has officially fallen through, Nvidia will still be paying SoftBank $1.25 billion under the terms of their agreement, bringing an end to almost two years of negotiations with regulators and uncertainty for other chip makers that rely on licensing Arm IP.

While Nvidia always maintained that it would not make changes to Arm's open licensing model, rival companies had their doubts and voiced concerns. Regulators in the US, EU and UK also had concerns around the deal, which ultimately led to the deal being squashed.

Now, Arm CEO, Simon Segars, will be stepping down and will be replaced by Rene Haas, Arm's head of IP. Additionally, SoftBank will go forward with its previous plans to turn Arm into a publicly traded company, starting with an IPO in the next fiscal year.

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KitGuru Says: We're at a point where regulators are more concerned about the power of tech companies more than ever. With that in mind, it is not too surprising that there was additional scrutiny around this deal. 

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