It’s official: Arm has applied for Nasdaq IPO

It’s official: Arm has applied for Nasdaq IPO

Arm has finally officially announced that it is seeking a listing on the Nasdaq stock exchange in New York. It should be the largest IPO in the US this year, experts estimate.

The desire to list on the Nas daq brings a provisional end to the soap opera surrounding the chip designer in recent years. Parent company SoftBank wanted to divest and/or spin off subsidiary Arm, first going for a takeover by another party.

Nvidia was eager to acquire Arm, but encountered a great deal of opposition from various regulators in the US, the UK, the EU, and elsewhere. Competition watchdogs were concerned that a takeover by Nvidia might prevent or limit other chip makers’ access to the technology considered vitally important to the processor industry.

Consolidation was also said to lead to less choice for customers. In addition, higher prices would also be in the offing. Based on these arguments, the potential acquisition was blocked by the various regulators. Subsequently, Nvidia and SoftBank decided to abandon the acquisition.

IPO as a new option

SoftBank then saw an IPO as a new option to divest Arm. Before that, the parent company did talk to several chip makers, hyperscalers and other tech giants to ensure that they would support the IPO, including by taking a stake itself in the soon-to-be-listed Arm.

Recent developments indicate that the parent company itself still wants to own 90 percent of the shares before Arm goes public. However, this could potentially bring the Japanese company a substantial amount of money, which it could use to offset a loss of about $30 billion at its investment vehicle Vision Fund.

Biggest IPO in years

The IPO should take place sometime in early September. Arm’s value should then reach somewhere between $60 billion and $70 billion. The price of a share of Arm will be announced shortly.

The chip designer’s IPO on the Nasdaq should be the largest new Nasdaq listing this year, in fact since the past two years. The last record IPO was in October 2021 when electric car manufacturer Rivian managed to raise $13.7 billion.

Also read: Softbank buys up Arm shares to boost stock market value