Graphics chip giant Nvidia has reportedly scrapped the $40 billion deal to acquire British chip designer Arm amid anti-trust probes in the US and Europe.

According to a report in the Financial Times, citing sources, Nvidia will instead spend up to $1.25 billion to Arm owner SoftBank for failing to go through with the transaction.

Arm CEO Simon Segars will reportedly lose his job to Rene Hass, who ran Nvidia’s own Arm business many years ago.

The companies did not respond to the report that came out late on Monday.

In December, the Federal Trade Commission (FTC) sued to block Nvidia’s $40 billion acquisition of Arm from Softbank on antitrust grounds.

The deal has faced scrutiny from regulators since it was announced last year.

“The proposed vertical deal would give one of the largest chip companies control over the computing technology and designs that rival firms rely on to develop their own competing chips,” the FTC had said in an announcement.

The ARM is a core supplier of architecture technology to most semiconductor companies. Its Arm instruction set is at the core of nearly all mobile processors powering smartphones, including those made by Apple and Android devices that use Qualcomm chips.

But the company’s role in the chip industry was historical as a neutral supplier, raising concerns that Nvidia could cut off competitors from essential Arm technology.

Some of Nvidia’s processors also use Arm-designed cores and its Arm architecture, although the company is best known for graphics processors, which use different architecture.

FTC Chair Lina Khan, who was appointed by President Joe Biden to lead the agency shortly after her confirmation earlier this year, has signaled an interest in more robust antitrust enforcement.

The European Commission in October opened an in-depth investigation to assess the $40 billion acquisition of Arm by Nvidia.