- Nvidia stock climbed as much as 4% on Wednesday to a record high of $676 per share.
- The jump came after CEO Jensen Huang said he is confident UK regulators will approve the Arm acquisition by next year.
- Nvidia’s takeover of the chip designer Arm is under review on “national security grounds” by UK regulators.
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In a video call at the Computex conference in Taipei on Wednesday, Huang said he is confident that UK regulators will approve the Arm acquisition by next year.
“I expect this one to take 18 months so that’s later this year, early next year. I am confident about the transaction,” Huang said. “Our companies are complementary so we’ll bring, by nature, innovations that come as a result of companies that come together and offer complimentary things.”
Huang’s statements come after UK regulators announced in an April Public Interest Intervention Notice (PIIN) that they would be reviewing Nvidia’s takeover of Arm on “national security grounds.”
Digital minister Oliver Dowden released a statement announcing the review of Nvidia’s takeover:
“Following careful consideration of the proposed takeover of Arm, I have today issued an intervention notice on national security grounds. As a next step and to help me gather the relevant information, the U.K.’s independent competition authority will now prepare a report on the implications of the transaction, which will help inform any further decisions.”
An Nvidia spokesperson said of the move by regulators: “We do not believe that this transaction poses any material national security issues.”
“The regulators are looking for: Is this good for competition? Is this pro-competitive and brings innovation to the market? Does it give customers more choice, does it give customers more offerings and more choice? You could see that on the first principle that our companies are completely complementary,” Nvidia’s CEO Jensen Huang said on Wednesday at the Computex conference
Arm was acquired by the Japanese conglomerate SoftBank in 2016 for $31 billion.
Nvidia has said it will pay roughly $40 billion for the company in the proposed acquisition and has committed to paying SoftBank $2 billion whether the deal goes through or not.
Nvidia stock is up roughly 88% in the past year and 26% in 2021 amid record demand for the company’s GPU products from cryptocurrency miners and gamers.
Nvidia recently landed analyst support after a stellar earnings report as well. Piper Sandler, Wedbush, and a number of other Wall Street firms reiterated their “buy” ratings and increased their price targets.
Specifically, Piper Sandler maintained its “buy” rating and raised its price target $690 while Wedbush reiterated its “outperform” rating and raised its price target to $700. Evercore also maintained its “buy” rating and raised its price target to $750.
Nvidia posted a record-breaking quarter on May 26, with sales jumping 84% year-over-year to $5.66 billion.