Nvidia Corp. and Japan’s SoftBank Group Corp. abandons a huge deal for Nvidia to acquire chip-designer Arm, according to a report by The Wall Street Journal on Tuesday.

  • The two companies stated that they agreed not to progress with the transaction due to significant regulatory challenges.
  • Softbank, which is the parent company of Arm, stated it plans to pursue a public listing for the British-based chip business.
  • The US graphics chip giant Nvidia agreed to acquire Arm for $40 billion from SoftBank in September 2020. The value of the deal grew due to the booming semiconductor demand.
  • The proposed arrangement quickly raised concerns with regulators and chip-manufacturer rivals. The company stated SoftBank is set to earn a $1.25 billion breakup fee from the failed transaction with Nvidia.

This is not the first time regulators have halted a massive chip deal. In 2018, the US government stopped Broadcom Inc’s move to acquire Qualcomm on national security grounds. Softbank Group Corp down -0.90%, NVDA down -1.16%, Pre-market trading