Nvidia-Mellanox $6.8B Deal Gets EU Clearance
U.S. chipmaker Nvidia has been granted unconditional approval by the European Union to acquire Israel networking company Mellanox Technologies, clearing a hurdle for the $6.8 billion deal, announced in March. The EU approval went through without Nvidia having to offer concessions.
The European Commission concluded that “the proposed acquisition would raise no competition concerns, because the companies mainly supply complementary products and they will not be able to leverage their respective positions into neighboring markets.”
The deal has already cleared the U.S. regulatory process without conditions, while approval from China is still pending.
“The two companies have now received regulatory antitrust approval for the deal from the European Commission and Mexico,” stated Mellanox in a Dec. 19, SEC filing. “In addition, the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, in connection with the proposed acquisition expired at 11:59 p.m., Eastern time, on May 23, 2019. The transaction remains subject to customary closing conditions and the remaining regulatory approval from the Anti-Monopoly Bureau of the State Administration for Market Regulation of the People’s Republic of China.”
The purchase is strategic for Nvidia as the company, once known primarily for its gaming technology and now a major HPC/AI player, resolves to get an even firmer grip on the data center market.
“We believe that in future data centers, the compute will not start and end at the server, but the compute will extend into the network. And the network itself, the fabric, will become part of the computing fabric. Long-term, I think we have the opportunity to create data center-scale computing architectures; short-term, Mellanox’s footprint in data centers is quite large. […] We will be in position to address this large market opportunity much better,” Nvidia CEO Jensen Huang said at the time of the March announcement.
Nvidia and Mellanox (working with IBM and the DOE) supplied the core technologies for the number-one and number-two world-ranking supercomputers, Summit and Sierra.
Nvidia reportedly outbid Intel, Microsoft and Xilinx to acquire Mellanox.
