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Nvidia’s Acquisition of AI Startup Run.ai Faces EU Antitrust Review

 |  November 3, 2024

The European Commission announced on Thursday that U.S. semiconductor giant Nvidia will need to obtain antitrust clearance for its proposed acquisition of Israeli AI startup Run. This move is rooted in concerns that the deal could undermine competition within the sectors both companies operate in, according to Reuters.

The potential for competition distortion has raised alarms among EU regulators, who may require Nvidia to propose concessions to gain approval for the transaction. This scrutiny reflects a broader trend among regulators in both Europe and the United States, who have intensified their oversight of tech firms’ acquisitions of smaller startups. Such acquisitions often spark fears that they may eliminate future competition by absorbing potential rivals, as noted by regulatory bodies.

Nvidia’s intent to acquire Run was first announced in April, with reports estimating the deal to be valued at approximately $700 million, as reported by TechCrunch. Run specializes in technology that enables teams and developers to effectively manage and optimize their AI infrastructure, a service increasingly in demand as AI applications grow more prevalent.

Interestingly, the acquisition does not meet the EU’s financial thresholds that would normally mandate a review. However, after notifying the Italian competition authority, the case was referred to the European Commission, which accepted the request for further investigation. The Commission expressed serious concerns regarding the transaction’s potential impact on competition, particularly within the European Economic Area, which includes Italy.

Related: Nvidia Faces EU Antitrust Scrutiny Over Planned Acquisition of AI Startup Run

In a statement, the Commission highlighted that “the transaction threatens to significantly affect competition in the markets where Nvidia and Run are active.” This acknowledgment underscores the high stakes involved in the deal and the necessity for thorough regulatory examination.

Nvidia has expressed its willingness to cooperate with regulators, stating that the company is prepared to answer any inquiries related to Run. A spokesperson for Nvidia reassured stakeholders, saying, “After the acquisition closes, we’ll continue to make AI available in every cloud and enterprise, and help customers select any system and software solution that works best for them.”

The acquisition comes at a time when Nvidia is enjoying remarkable success, reporting significant profits and revenues driven by its cutting-edge processors, which have become essential for AI applications, including those used for training models like ChatGPT.

Source: Reuters

Power Industry Shake-Up: Constellation Energy to Buy Calpine in Massive $26.6B Deal Power Industry Shake-Up: Constellation Energy to Buy Calpine in Massive $26.6B Deal

Power Industry Shake-Up: Constellation Energy to Buy Calpine in Massive $26.6B Deal

 |  January 10, 2025

US-based nuclear power giant Constellation Energy has announced a landmark deal to acquire privately-held natural gas and geothermal company Calpine Corp for $16.4 billion in a move that reshapes the American energy landscape. The acquisition, one of the largest in the history of the U.S. power sector, comes at a time of surging electricity demand driven by the rapid expansion of energy-intensive technologies like artificial intelligence and the ongoing electrification of transportation and buildings.

According to Yahoo the agreement will transform Constellation into the largest independent power provider in the United States, with a diverse portfolio spanning nuclear, natural gas, and geothermal energy sources. The deal, which also includes Calpine’s debt, values the transaction at $26.6 billion.

Following the announcement, Constellation’s stock surged by as much as 10% before markets opened, with gains extending to 22% shortly after trading began. The company expects the acquisition to close in the second half of 2025. Once finalized, the merger is projected to add $2 billion in annual free cash flow, further strengthening Constellation’s financial position.

Read more: Federal Competition Office to Scrutinize High Electricity Prices in Germany

The acquisition reflects the growing urgency for reliable and sustainable energy solutions. Per Yahoo, the combined entity will boast nearly 60 gigawatts (GW) of low- and zero-emission capacity, allowing Constellation to solidify its position as a key player in the nation’s clean energy transition. CEO Joe Dominguez emphasized the critical need to meet rising energy demands, saying, “Demand for our products is expected to grow by levels we haven’t seen in a lifetime.”

The transaction significantly expands Constellation’s geographic footprint, particularly in the high-demand markets of Texas and California. With this deal, Constellation’s share of generation capacity in Texas will jump from 11% to 23%, while its presence in California will rise to 10%, up from a negligible amount. Both states rank among the most populous and energy-intensive in the country.

Aneesh Prabhu, an analyst with S&P, described the deal as transformative, noting that the merger will create “the largest coast-to-coast power generator” in the U.S. The acquisition will also boost Constellation’s workforce by 20%, adding approximately 2,750 employees to its ranks and bringing the total headcount to 16,500.

Source: Yahoo