SoftBank Group disclosed the registration statement for a proposed Arm IPO today. The Japanese investment conglomerate acquired the semiconductor technology company for $32 billion back in 2016, and has been trying to divest for several years. It appears that the long-awaited Arm IPO will be coming soon to the NASDAQ stock market exchange.
This afternoon's news of the upcoming Arm IPO should not come as a surprise to folks who have been following the trials and tribulations of SoftBank Group's attempts to exit the investment. Nvidia offered $40 billion to acquire Arm from SoftBank in September 2020. In February 2022, the deal's value had ballooned to $66 billion and had been rejected by regulators in the United Kingdom. After attempting to put together an Arm IPO in London, SoftBank went back to the drawing board in July 2022.
This will not be Arm's first rodeo as a publicly-traded stock. The company was listed on the London Stock Exchange and NASDAQ from 1998 until being acquired by SoftBank in 2016. Arm was launched as a joint venture between Acorn Computers, VLSI Technology, and Apple Computer Inc. back in 1990, and flew under the radar for most of the 90s and 2000s. It wasn't really until the advent of current smartphones that Arm's value as experts in low power system on chips (SoCs) began to materialize. Arm does not actually manufacture semiconductors, but the company does license out its technology to chip makers. Companies like Apple, Samsung, and Nvidia have all produced processors built on Arm's technology. In fact, Apple Silicon is all built on Arm's technologies as well as the Nintendo Switch chip. Just a few weeks ago, rumors began to swirl that Amazon was trying to invest in Arm ahead of this IPO.
Arm has disclosed that nearly 50% of the company's royalty revenues came from smartphone and consumer electronic devices in the most recent fiscal year, but revenues have been on the decline as recent weakness has appeared in the broader smartphone market. It is important to note that today's filing from SoftBank is not an IPO prospectus, so keep an eye on Shacknews for more information on what can only be described as the most anticipated technology IPO in recent years. While we do not know the amount of money to be raised, or how much of the Arm investment SoftBank plans on selling, or what valuation the IPO will set, we do know that the company's new stock symbol will be ARM whenever it makes its NASDAQ debut.
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.