Nvidia's board has hired Wachtell, Lipton, Rosen & Katz to investigate CEO Jensen Huang's relationship with a suspected Chinese spy. Around $430bn has been wiped off the company's value since the story broke, though its shares rose in early trading on Wednesday.
Nvidia's board retained former acting U.S. Attorney Joon H. Kim and his firm Wachtell, Lipton, Rosen & Katz to look into Huang's ties to a woman US officials believe is a Chinese spy. The company said the review would be "a thorough and independent investigation".
The probe centres on Huang's affair
The inquiry will examine the circumstances of an affair thought to be with Alice Huang, who worked for Nvidia customer Megaspeed. Beijing has denied allegations that it ran an espionage operation targeting Huang.
Wachtell is a heavyweight corporate law firm. In 2022 Twitter hired it to force Elon Musk to complete his $44bn takeover.
Shares fall, then bounce
Nvidia's value has been buffeted this week. Its shares fell almost 5.5% on Tuesday, after a 4.27% drop on Monday, pulling the company's value down to $4.07tn from $4.50tn before the story broke.
On Wednesday, however, Nvidia's share price was up 2% in early trading after two days of falls.
Baird cuts its rating
Investment bank Baird cut its rating on Nvidia to neutral, Reuters reported. Baird lowered its price target to $200 from $500, while the shares closed at $168.89 on Tuesday.
The FT's Unhedged column suggests that removing Huang may simply be too big a risk.
Source: The Guardian
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