Peter mandelson, former business secretary, has called for competition authorities in the uk, china and europe to investigate the takeover of arm holdings by us group nvidia.

In a letter to the financial times on thursday, lord mandelson said that cambridge-based arm would become collateral damage in the battle between nvidia and intel to dominate the global microchip market.

Nvidia, the worlds largest chipmaker, plans to buy arm for $40bn, just four years after the uk group was bought by japanese investor softbank.

Jensen huang, chief executive of nvidia, has promised to keep its cambridge headquarters while also investing in its workforce but critics have questioned whether those promises are legally binding.

British ministers have said virtually nothing about the deal since it was first announced on september 13.

Oliver dowden, the culture secretary, has the power to send the deal to the competition and markets authority on grounds of national security but has not yet made any announcement.

Colleagues have privately suggested that mr dowden is wary of antagonising the us authorities given that softbank did not face in-depth scrutiny when it purchased arm in 2016.

My fear is that arm becomes the collateral damage in this struggle as nvidia, once it has assumed ownership, will be able to throttle arms ability to supply all players freely in the marketplace as it does presently, lord mandelson wrote.

Arm, which designs chips used in mobile phones, had prospered by licensing its intellectual property to companies like nvidia and intel to use in their products.

Some believe that nvidia will break with this model and argue that the purchase is about acquiring access to arms intellectual property and denying it to others, the peer said. they suggest nvidias rationale for the purchase is strengthening its own market power at the expense of arm serving the marketplace as a whole.

That would not be in the public or consumer interest of the uk, said lord mandelson, who was de facto deputy prime minister under gordon brown.

As a result there was a pressing need for scrutiny of the deal with the toughest examination from regulators in china, the uk and europe, he said.

This should, of course, include looking at commitments on the location of headquarters and jobs. but these are not the most important dimensions. it needs above all to probe nvidias business plan for arm, he added.

Lord mandelson said he had no conflicts of interest with either company through his corporate advisory firm called global counsel.

Darren jones, chair of the business select committee, wrote on thursday to business secretary alok sharma raising a series of questions about the deal.

Mr jones, a labour mp, raised questions about the impact of the acquisition on jobs and on britains industrial strategy while also asking what considerations had been made of the potential impact of trade sanctions from the us.

A series of concerns have been raised regarding the future of arm in this country, of thousands of jobs in the uk, and its role in the uk technology industry. i hope that the beis secretary of state will be able to provide some clarity on these issues and offer some reassurance that every effort is being made to safeguard the success of arm in the uk, he said.

Ed miliband, shadow business secretary, has previously urged the government to extract gold-plated promises from nvidia as soon as possible that would be enforceable by the takeover panel.

Softbank made legally-binding assurances to keep arms cambridge headquarters and double the companys uk workforce over five years.