Softbank-Backed Arm Files for Likely Biggest IPO of Year
The lengthy ownership issue of Arm Holdings, the SoftBank-owned chipmaker, appears to be concluding, as the business announced late Monday that it filed for a long-awaited initial public offering (IPO) on the Nasdaq, which is projected to be the largest of the year.
Arm did not offer a predicted share price or number of shares, although SoftBank recently purchased a 25% stake in Arm from its Vision Fund business for $16 billion, with a reported valuation of $64 billion. According to Bloomberg, SoftBank is aiming for an IPO valuation of $60 billion to $70 billion.
Arm, whose designs are at the heart of nearly every smartphone and numerous other embedded computers, has been in flux since early 2022, when NVIDIA’s $40 billion takeover bid was canceled owing to US and European regulatory pressure.
SoftBank bought Arm in 2016 as a growth vehicle for the investment group. Following the failure of previous SoftBank investments like WeWork, the firm began shopping Arm in 2020.
According to the IPO filing, SoftBank will retain voting power for Arm, indicating they are not completely divesting themselves of the company. The IPO might provide SoftBank and its founder Masayoshi Son a financial windfall, helping to offset losses of almost $30 billion recorded by his Vision Fund last year.
The offering is being led by Barclays Plc, Goldman Sachs Group Inc., JPMorgan Chase & Co. and Mizuho Financial Group Inc. It also listed 24 additional underwriters in its document.
In its filing, Arm disclosed it had $2.68 billion in revenue for the fiscal year ended March 31, a slight decrease from the previous year but a 32% increase from 2021. Net income was $524 million compared with $549 million the previous year.
