Elon Musk Raised Concerns About Nvidia's $40 billion Acquisition Of Arm
Update: 2021-08-31 12:00 IST
Tesla CEO Elon Musk
Elon Musk, the CEO of Tesla, has expressed concern over Nvidia's $40 billion bid for chipmaker Arm, joining a chorus of companies and individuals who have spoken out against the merger. However, his opposition did not affected much on Nvidia's (NVDA) shares. Monday's closing price was $226.884, up 0.2 percent. The S&P 500 index increased by 0.4 percent. The Dow Jones Industrial Average ended the day with a loss of 0.2 percent.
Nvidia's acquisition of Arm would completely transform the semiconductor market, combining a firm known for its graphics chips, many of which are used in data centres to power artificial intelligence programs, with a company known for its processors in smartphones and PCs.
For starters, Tesla is substantially investing in its self-driving technology. Graphics processing is required by the computers that enable self-driving car capabilities. Nvidia also develops and sells autonomous driving technology to other automakers and suppliers. Tesla does not want a major rival to win. That is one of the reasons getting opposed to the agreement.
While one more reason of this disagreement might be including 'arm customer'. Tesla is an Arm customer as well, employing the company's chips in its self-driving computer. Tesla may be compelled to acquire processors from a competitor if Nvidia buys Arm.
Tesla is putting more on building its own computing power, according to Wedbush analyst Dan Ives. Others expanding their technology platforms at a higher rate than Musk's company may irritate him.
However, Tesla has yet to react to a request for comment on its reservations about the acquisition. Nvidia did not respond to a request for comment.
Meanwhile, Nvidia said on Friday that it expects to seek European Union permission. The Competition and Markets Authority in the United Kingdom expressed severe concerns about Nvidia's ambitions earlier this month, calling for an in-depth examination into the deal.