Nvidia Secures EU Approval For Run:ai Deal, US Probes China Export Breach

The European Commission granted unconditional approval Thursday for Nvidia Corp NVDA to acquire Run:ai Labs Ltd, an Israel-based provider of GPU orchestration software.

The decision under the EU Merger Regulation concluded the acquisition would not raise competition concerns within the European Economic Area.

Nvidia, a U.S.-based leader in GPU technology for data centers, gaming and automotive applications, aims to integrate Run: ai’s software into its ecosystem. Run:ai specializes in software that helps organizations optimize and manage their artificial intelligence compute workloads across various environments, including on-premises and cloud platforms.

The commission’s investigation focused on whether the merger could harm competition in two critical markets: discrete GPUs for data centers and GPU orchestration software.

Although Nvidia holds a dominant position in the global market for data center GPUs, the inquiry determined the company lacks the technical ability and motivation to limit compatibility between its GPUs and competing software solutions. Similarly, Run:ai does not command a significant market share in GPU orchestration software, ensuring continued access to alternative providers for customers.

Super Micro Computer Inc SMCI and Dell Technologies Inc DELL server products embedded Nvidia AI chips.

Some customers replicated serial numbers of the servers containing Nvidia chips purchased from Super Micro and attached them to other servers.

Also, smugglers altered the serial numbers in the server operating system.

Dell and Super Micro said they complied with the regulatory norms.

U.S. Big Tech giants have drawn intense regulatory scrutiny for allegedly trying to stifle fair competition by exploiting their influence.

In 2024, U.S. regulatory bodies, including the Department of Justice’s antitrust division, reviewed Nvidia’s potential dominance within the AI chip sector. The Federal Trade Commission was also examining investments by the Big Tech giants.

Nvidia’s plans to purchase British chip designer Arm Holdings plc ARM succumbed to global regulatory opposition. Other significant acquisitions that failed to win regulatory approval included Broadcom Inc’s AVGO plans to acquire Qualcomm Inc QCOM.

Meanwhile, the U.S. Department of Commerce urged Nvidia to investigate how the company’s products reached China by flouting the semiconductor embargo, Reuters reported, citing The Information.

The Biden Administration slapped semiconductor sanctions on China by restricting its access to advanced artificial intelligence technology chips and equipment meant to produce the chips.

Nvidia urged leading distributors like Super Micro Computer and Dell to conduct spot checks of Southeast Asian customers.

Nvidia stock surged over 171% year-to-date. Investors can gain exposure to the stock through VanEck Semiconductor ETF SMH and Fidelity MSCI Information Technology Index ETF FTEC.

NVDA Price Action: Nvidia stock is up 1.74% at $132.95 at publication Friday.

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