SoftBank Gathers Apple & Nvidia As Key Supporters For Arm IPO
SoftBank Group Corp. is enlisting major Arm Ltd. customers, such as Apple Inc., Nvidia Corp., Intel Corp., and Samsung Electronics Co., as strategic investors for Arm's upcoming initial public offering (IPO), according to sources familiar with the matter.
Other investors in the IPO include Advanced Micro Devices Inc., Cadence Design Systems Inc., Google (a subsidiary of Alphabet Inc.), Synopsys Inc., and more, though these details have not been officially announced. SoftBank has been in discussions with Arm's customers and partners for several months, with plans now being finalised as the IPO's investor roadshow is expected to begin next week.
These strategic investors are expected to contribute between USD 25 million and USD 100 million each, which will help strengthen the IPO. The offering aims to raise between USD 5 billion to USD 7 billion. SoftBank initially had plans to value Arm's chip business between USD 60 billion to USD 70 billion but may now target a range of USD 50 billion to USD 60 billion.
Notably, representatives from AMD, Arm, Google, Nvidia, and Synopsys declined to comment, while Apple, Cadence, Intel, and Samsung did not immediately respond to requests for comment.
SoftBank is capitalising on the growing interest in the chip industry, driven by investments in artificial intelligence equipment. Arm, known for providing chip designs and technology licenses, plays a crucial role in the smartphone market and is expanding its presence in areas like data center computers.
Arm is considering pricing its shares on 13 September, with trading starting the following day. This decision comes after SoftBank acquired Vision Fund's stake in Arm, valuing the chip company at over USD 64 billion.
A successful IPO for Arm would be a significant achievement for SoftBank CEO Masayoshi Son, who faced significant losses in his Vision Fund last year. It may also inspire other companies, like Instacart, Klaviyo, and Birkenstock, to pursue their own IPO plans. However, Son aims to retain more than 10 per cent of the company.
Arm has gathered a substantial list of underwriters for the IPO, with Barclays Plc, Goldman Sachs Group Inc., JPMorgan Chase & Co., and Mizuho Financial Group leading the offering, reflecting the company's global reach and banks' eagerness to participate in significant deals in a sluggish listings market.
