The decision came as the UK government said that it will look into the national security implications of Nvidia's proposed acquisition of the British chip designer ARM Holdings. The announcement has raised serious questions over whether the $40 billion deal will now be approved.
"As a next step and to help me gather the relevant information, the UK’s independent competition authority will now prepare a report on the implications of the transaction, which will help inform any further decisions," said Dowden.
“We want to support our thriving UK tech industry and welcome foreign investment, but it is appropriate that we properly consider the national security implications of a transaction like this,” Dowden added.
ARM is a major player in global semiconductors and its IP and technology is used across a range of critical technologies from artificial intelligence and quantum computing to 5G telecoms networks.
Semiconductors also underpin Britain's critical national infrastructure and, according to the government, officials from the security community had supported the decision to intervene.
The Competition and Markets Authority will assess the competition, jurisdiction and national security impact of the deal, with a report due by July 30, the government said.
Once the investigation has been completed, Dowden will then need to decide whether to clear the transaction or require undertakings by the companies to remedy concerns. He could also refer the deal to an in-depth investigation for further scrutiny.
Nvidia said it did not believe the deal posed any material national security issues and would. "continue to work closely with the British authorities, as we have done since the announcement of this deal."