The UK Competition and Markets Authority (CMA) intends to investigate Nvidia's recent $40 million acquisition of chip maker ARM. 

Nvidia purchased the semiconductor and software design company in September last year for $21.5 billion in common stock and $12 billion in cash, but now the deal is being scrutinised by UK authorities over the effect it could have on competition in the UK. 

"The CMA is likely to consider whether, following the takeover, Arm has an incentive to withdraw, raise prices or reduce the quality of its IP licensing services to NVIDIA’s rivals," said CMA chief executive Andrea Coscelli. 

"The chip technology industry is worth billions and critical to many of the products that we use most in our everyday lives. We will work closely with other competition authorities around the world to carefully consider the impact of the deal and ensure that it doesn’t ultimately result in consumers facing more expensive or lower quality products.”

The CMA will begin its formal investigation later this year, and is currently inviting views on the impact of the deal from interested third parties as it begins to assess the merger.