SoftBank's chip maker Arm Ltd has filed confidentially for a U.S. stock market listing, setting the stage for this year's largest initial public offering (IPO). Despite adverse market conditions, Softbank is pressing ahead with the blockbuster offering after saying in March that it planned to list Arm in the U.S. stock market. Arm plans to sell its shares on Nasdaq later this year, seeking to raise between $8 billion and $10 billion. The exact timing and size of the IPO are subject to market conditions and have not yet been determined.
Arm's IPO is expected to boost the fortunes of SoftBank, which is battling to turn around its giant Vision Fund, hit by losses due to the declining valuations of many of its holdings in technology startups. Since the collapse of its deal to sell the chip designer to Nvidia Corp for $40 billion last year, Arm's business has fared better than the broader chip industry due to its focus on data center servers and personal computers generating higher royalty payments. Arm's sales were up 28% in its most recent quarter.
Earlier this year, Arm rebuffed a campaign from the British government to list its shares in London and said it would pursue a flotation on a U.S. exchange. Arm's IPO preparations are being led by Goldman Sachs Group Inc, JPMorgan Chase & Co, Barclays and Mizuho Financial Group.
The IPO market has been hit by stock market volatility and economic uncertainty, putting many IPO hopefuls off, leading U.S. IPOs, excluding listings for special purpose acquisition companies, to be down about 22% to a total of just $2.35 billion year-to-date, according to Dealogic. However, there are signs that the IPO market is beginning to thaw, with Johnson & Johnson Inc preparing to list its consumer health business Kenvue Inc in New York next week, hoping to raise about $3.5 billion.
In conclusion, SoftBank's chip maker Arm Ltd has filed confidentially for a U.S. stock market listing, seeking to raise between $8 billion and $10 billion later this year. The exact timing and size of the IPO are subject to market conditions, but the offering is expected to boost SoftBank's fortunes, which is battling to turn around its giant Vision Fund. Arm's IPO preparations are being led by Goldman Sachs Group Inc, JPMorgan Chase & Co, Barclays and Mizuho Financial Group.
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