Arm Holdings IPO planned by Softbank following failed NVIDIA deal

Oh hey, I have a new most anticipated IPO of 2022. It's Arm Holdings. You know, the company NVIDIA wanted to buy for $40 billion?


Sad news out of giant corporate merger land this evening as the $66 billion Arm Holdings acquisition by NVIDIA has collapsed under regulatory scrutiny and fear of a monopoly. Arm's technology is at the core of many consumer electronics devices we use every day, and the deal was viewed as anticompetitive by regulators and many other competitors in the semiconductor industry. Softbank, Arm's current parent company, has a plan to turn the lemon of a deal into some lemonade. An Arm Holdings IPO will instead be the way forward. 

The original valuation of the NVIDIA deal for Arm Holdings valued the transaction at around $40 billion of combined cash and NVDA shares in September 2021. At the peak of NVIDIA's stock valuation in November, the deal was set to net Softbank almost $90 billion. As of today, the deal was still set to bring in close to $66 billion if it were able to close. The FT was the first to report the news of the collapsed deal, but they put everything behind a paywall over there.

Sad Jensen is sad.
Sad Jensen is sad.

According to several people close to the deal, NVIDIA abandoned the deal earlier on Monday. Apparently, NVIDIA even offered to maintain sales to Arm's other customers following the deal, and UK regulator did not agree it would be effective enough. The deal was largely viewed as anticompetitive by regulators, consumers, and many large tech companies. Some folks in the market may have been ahead of this news. NVIDIA (NVDA) shares are down 28% from the all-time high hit in late November 2021.

NViDIA shares have been going down for some time, as many began to realize the $40 billion ARM deal may have face insurmountable regulatory headwinds.
NVIDIA shares have been going down for some time, as many began to realize the $40 billion ARM deal may have face insurmountable regulatory headwinds.

The good news today is that we all will hopefully have a chance to buy shares of Arm Holdings. This company is at the heart of so many amazing products and ecosystems, it will truly be one stock to immediately put on the old watch list. As for the timing of the IPO, or valuation, we have no idea. Softbank will be motivated to move, because they just lost out on one of the sweetest pay days in the history of technology mergers and acquisitions. 

This article is only meant for educational purposes, and should not be taken as investment advice. Please consider your own investment time horizon, risk tolerance, and consult with a financial advisor before acting on this information.


Asif Khan is the CEO, EIC, and majority shareholder of Shacknews. He began his career in video game journalism as a freelancer in 2001 for Asif is a CPA and was formerly an investment adviser representative. After much success in his own personal investments, he retired from his day job in financial services and is currently focused on new private investments. His favorite PC game of all time is Duke Nukem 3D, and he is an unapologetic fan of most things Nintendo. Asif first frequented the Shack when it was sCary's Shugashack to find all things Quake. When he is not immersed in investments or gaming he is a purveyor of fine electronic music. Asif also has an irrational love of Cleveland sports.

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