Benzinga | Nov 16, 2021 10:57AM EST

Nvidia-Arm Deal Faces UK National Security Probe: CNBC

* The U.K. Digital and Culture Secretary Nadine Dorries ordered a "phase 2" investigation into NVIDIA Corp's (NASDAQ:NVDA) $40 billion bid for Cambridge chip designer Arm, CNBC reports.

* Competition and Markets Authority will initiate the probe over the next 24 weeks, including antitrust concerns and national security issues associated with the deal.

* The CMA had severe concerns about the deal after it completed the initial "phase 1" probe. The deal is now unlikely to be completed before the initial deadline of March 2022.

* Critics believe that the merger could restrict access to Arm's "neutral" chip designs and lead to higher prices, less choice, and reduced innovation in the semiconductor industry. But Nvidia argues that the deal will lead to more innovation and that Arm will benefit from increased investment.

* In October, the European Commission launched its in-depth investigation into the deal, alleging "Whilst Arm and Nvidia do not directly compete, Arm's IP is an important input in products competing with those of Nvidia, for example in data centers, automotive and in the internet of things."

* Price Action: NVDA shares traded higher by 0.43% at $301.45 on the last check Tuesday.