The British government should step in to ensure that Cambridge-based chip designer ARM keeps its headquarters in the UK, Labour has said.
SoftBank, which bought ARM in 2016, is in advanced talks to sell the company to US-based Nvidia.
The government should obtain “legally binding assurances” about ARM's location, Labour's Ed Miliband said.
A government spokesman said any takeovers representing a threat to the UK would be investigated.
ARM creates computer-chip designs that others then customise to their own ends. It also develops instruction sets, which define how software controls processors.
It was sold to Japan’s SoftBank in 2016 for £24.3bn but the conglomerate is now known to be in talks to sell ARM to US-based chip maker Nvidia.
“The government should show leadership and seek legally binding assurances from Nvidia should it take over the company to keep ARM headquartered in the UK rather than see jobs and decision-making moved across the ocean,” said shadow business secretary Ed Miliband in a statement.
“While proposed acquisitions are primarily a commercial matter for the parties concerned, the government monitors these closely,” a government spokesman said.
“Where we feel a takeover may represent a threat to the UK, the government will not hesitate to investigate the matter further, which could lead to conditions on the deal.”
ARM’s co-founder Tudor Brown, who worked for the company for 29 years, has previously spoken out against ARM being sold to a semiconductor firm.
It should instead remain a neutral supplier to tech companies, he suggested.