With Chinese regulators issuing their approval, the final piece has fallen into place for Nvidia’s $6.9 billion acquisition of high performance interconnect provider Mellanox, announced in March 2019.
The deal has already gone through the regulatory process in the U.S. and the European Union, with unconditional approvals granted.
China’s approval of the deal was not a given. In its story yesterday, Reuters stated that companies with major Chinese operations have come up against regulatory challenges resulting from the ongoing trade war between China and the U.S. For example, American chip maker Qualcomm was forced to cancel a $44 billion acquisition of NXP Semiconductors two years ago after an unsuccessful bid for China’s approval of the deal.
The news culminates a long acquisition process for Nvidia that began in 2018, when rumors surfaced regarding several Mellanox suitors, including Intel, Microsoft and Xilinx.
The purchase of the Israeli-based company is a significant strategic move for Nvidia. The company, once known primarily for producing GPUs for the gaming industry, has also become a major player in the high performance computing and artificial intelligence industries (Nvidia and Mellanox, working with IBM and the U.S. Department of Energy, supplied the core technologies for the number-one and number-two world-ranking supercomputers, Summit and Sierra), with a growing presence in the data center server market.
“Future data centers of all kinds will be built like high performance computers,” said Nvidia CEO Jensen Huang at the time the acquisition was announced last year. “Data centers are the most important computers in the world today, and in the future – as the workloads continue to change triggered by artificial intelligence, machine learning, data analytics and…