Nvidia pays an Arm and a leg for UK chip designer

Chipping forecast.

Graphics giant Nvidia will splash $40bn (£31bn) on UK chip design firm Arm.

Nvidia, whose technology lies in millions of PC and consoles, was already a big client of Arm, whose chips also power numerous other devices – including Android devices and iPhones made by Apple, Samsung and Huawei.

The deal has yet to be finalised and is subject to approval, but a UK government source today told BBC News the sale would not be blocked, despite previous concerns.

Arm co-founders Hermann Hauser and Tudor Brown have said the sale risks Arm’s independence as a chips maker for Nvidia’s rivals – and that it could also act as a backdoor to US influence. The fear is Arm, which also makes chips for Chinese companies, could become a pawn in a Washington trade war.

In response, Nvidia boss Jensen Huang has pledged Arm will stay neutral and will remained headquartered in Cambridge, where a new AI research centre will be built, growing the company’s UK employment in the process.

The Japan-based Softbank paid $32bn for Arm only four years ago.