Arm cofounder Hermann Hauser said it would be a “disaster” if Nvidia buys the British company he helped to build.

It was announced on Sunday that Nvidia intends to buy Arm, who supply chips to companies like Samsung and Apple, for $40bn off their current owner, Japan’s Softbank. 

The company was sold to Softbank for $31bn in 2016, with one condition of the sale being that Arm remained headquartered in Cambridge in the UK.

Speaking on BBC Radio 4 on Monday, Hauser said Nvidia buying Arm was a “disaster for Cambridge, the UK and Europe.” 

He said thousands of employees would lose their jobs at bases in Manchester, Belfast, Warwick and Cambridge if Nvidia “inevitably” moved the headquarters to America. 

Over the weekend, Nvidia promised to keep the headquarters in Cambridge and said the deal will create more jobs. Hauser, however, said the promise meant nothing unless legally enshrined.

Hauser also published an open letter to the UK government on Monday, warning that the sale of Arm to Nvidia would destroy the company’s business model. He described Arm as “the Switzerland of the semiconductor industry” because it deals in an “even-handed way” with over 500 licensees, a position Hauser said would be compromised by the deal.

In the open letter, Hauser said the Nvidia takeover would also have implications for the UK’s economic sovereignty. “Arm is the only remaining UK technology company, with a dominant position in mobile phone microprocessors,” he said. 

“The UK has suffered from American technology dominance by companies like Google, Facebook, Amazon, Netflix, Apple and others. As the American president has weaponised technology dominance in his trade war with China, the UK will become collateral damage unless it has its own trade weapons to bargain with.”

Hauser said the deal would have ramifications for companies who use Arm’s chips. It would mean, he said, any company wanting to export a product that uses an Arm chip would have to ask the US government for permission rather than the UK, reducing the sovereignty of the UK over exports.  “Sovereignty used to be mainly a geographic issue, but now economic sovereignty is equally important,” he wrote.

However, Arm’s chief executive, Simon Segars, said in a statement that the two companies shared the same vision, that “ubiquitous, energy-efficient computing will help address the world’s most pressing issues from climate change to healthcare, from agriculture to education.”

“By bringing together the technical strengths of our two companies,” Segars wrote, “we can accelerate our progress and create new solutions that will enable a global ecosystem of innovators.”

Before the deal was properly announced on Sunday, others had voiced concern too. The UK’s Shadow Business Secretary, Ed Miliband, said in a statement to CNBC on Friday, that the government needed to consider  “the possible implications for where the company is headquartered and the thousands of jobs in Britain that depend on it.”

Miliband also warned about the risk of a monopoly. “We also know the tendency of dominance is a particular problem in the tech sector, and government must be much more vigilant about the risks of this,” he said.

In a response at the time, a government spokesperson said that they monitor deals such as this closely, and where they feel a takeover represents a threat to the UK, they investigate further. 

 

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