‘Meaningless guff’ from minister over potential sale of Arm to Nvidia slated by Cambridge MP Daniel Zeichner
Cambridge MP Daniel Zeichner has described the international trade minister’s response to a question about saving the city’s tech giant Arm from the clutches of US-based Nvidia as “meaningless guff”.
There are fears for the future of the Fulbourn Road company, which designs the chips used in most of the world’s mobile phones, after it emerged that its Japanese owner, Softbank, is considering the sale.
Arm’s co-founder Hermann Hauser has warned that the sale to Nvidia would be “disastrous” for the company, for Cambridge and for the UK’s tech sovereignty.
He has called on the government to intervene and block the sale, suggesting that an IPO (initial public offering) on the London Stock Exchange and other markets should be pursued instead.
In the House of Commons today, Labour MP Mr Zeichner asked Ranil Jayawardena, the minister for international trade: “What is the government’s response and can I ask the minister what discussions he’s having with colleagues to make sure this jewel in our tech crown is not dismembered?”
Mr Jayawardena, the Conservative MP for North East Hampshire, replied: “Arm is a very successful business and I have regular conversations with my colleagues in a number of departments. I think the most important thing here is that we make sure the environment in the UK is an environment that all sorts of businesses want to work in and we preserve our national security of course as well.”
Mr Zeichner condemned the minister’s “lacklustre” response.
“Arm is a stategic asset, and it would be in the public interest to intervene, not just to save high-tech jobs, but to safeguard Arm’s neutrality from an American company eyeing up the tech,” he said.
“It is simply not good enough for the government to sit back as the clock ticks down. The minister's response that we want to create an environment in the UK where all businesses want to work, is meaningless guff.
“You might think they would come up with something a bit bespoke for a £23billion company! Arm is iconic and part of a unique ecosystem of tech companies. We need action now.”
Dr Hauser told the Cambridge Independent that Arm’s sale would be disastrous for three main reasons.
“The most pertinent to Cambridge is the job losses that will inevitably go with moving headquarters to Silicon Valley,” he said.
“The second problem is it destroys Arm’s neutrality, which is the fundamental reason why we spun out Arm from Acorn in the first place.
“I argued at the time that people wouldn’t buy a microprocessor from a competitor and most of the 500-plus licensees that we have at Arm are competitors of Nvidia.
“But by far the worst is the third reason - technology sovereignty. We’ve been complaining about the dominance of Google, Amazon, Netflix and Facebook in different areas, and there has been lots of discussion about how we in the UK and Europe have managed to allow this to happen.
“With an Arm sale, we pass the last great European semiconductor company that has a global dominance in smartphones to the Americans.”
Arm was acquired in 2016 for $32billion by Japanese conglomerate Softbank.
It has maintained Cambridge as Arm’s headquarters, invested in the company and preserved its neutrality, meaning it is free to license its technology to any other company.
But Softbank posted a $12.7billion loss for the year ending March 31 - its first loss in 15 years - prompting it to consider the sale of Cambridge’s, and the UK’s, most valuable technology company.
Last month, South Cambridgeshire’s Conservative MP, Anthony Browne, a former chief executive of the British Bankers’ Association, told the Cambridge Independent: “I am deeply concerned about the sale of Arm, and the impact it could have on jobs in Cambridge and the technological leadership of the UK.
“The government should only approve the sale so long as it is clearly in the national interest - as well as Cambridge’s interest. It is important for the UK to be open to international investment, which brings finance and expertise. But over the last few decades British governments of all hues have been too casually optimistic about the consequences of selling major British companies, when it is clear that actually ownership really does matter.”
Nvidia has overtaken Intel as the world’s most valuable chip company.
Arm, Softbank and Nvidia have not commented on the deal.
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