Arm Holdings Ltd., a UK-based technology company specialising in chip design, on Friday, August 18, applied for a listing on the Nasdaq stock exchange in the US, taking a step toward what’s set to become the biggest US initial public offering (IPO) of the year. — a bet that the once obscure designer of phone chips can flourish in the era of artificial intelligence. The company applied for a Nasdaq listing on Monday, August 21.
Here are 10 key things to know about the upcoming Arm IPO:
1. Nasdaq Listing
Arm Holdings applied for a listing on the Nasdaq stock exchange, indicating its intention to go public in the US.
2. Lead underwriters
The IPO is being led by major financial institutions, including Barclays Plc, Goldman Sachs Group Inc, JPMorgan Chase & Co, and Mizuho Financial Group Inc. Notably absent is Morgan Stanley from the list of top-tier underwriters.
3. Shift from London Stock Exchange
Arm's decision to list in the US rather than its home country dealt a blow to the London Stock Exchange, signalling a strategic move to tap into the US market.
4. IPO timeline
Arm plans to start its roadshow in early September, with the IPO's pricing expected to take place in the following week.
5. Valuation estimate
While the company didn't disclose specific terms in the filing, experts anticipate Arm to seek a valuation ranging from $60-70 billion.
6. Customer backing
Arm has engaged in discussions with some of its major customers about supporting the IPO, further underlining investor interest.
7. Lower IPO target
Originally aiming for an $8-10-billion IPO, Arm's target could be adjusted due to SoftBank's decision to retain more ownership after purchasing Vision Fund's stake.
8. Importance in chip industry
Arm is a crucial player in the chip industry, licensing instruction sets that power mobile, PC, and server chips. Its push into complete chip designs has proven more profitable.
9. Prominent clientele
Arm's technology is used by tech giants including Amazon, Alphabet, AMD, Intel, Nvidia, Qualcomm, and Samsung. Apple's iPhone chips also integrate Arm's technology.
10. Regulatory hurdles and ownership
SoftBank's attempt to sell Arm to Nvidia faced regulatory challenges over competition and national security concerns. SoftBank acquired Arm in 2016 for $32 billion and now plans to profit from its IPO.
The Arm IPO holds the potential to provide a significant boost to the flagging IPO sector, and its success would mark a substantial windfall for SoftBank's founder, Masayoshi Son. As the IPO date approaches, industry observers will closely watch the developments and the impact of this significant technology listing.
(Edited by : Shoma Bhattacharjee)
First Published: Aug 22, 2023 4:22 PM IST
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
In Andhra Pradesh's silk hub, weavers' cry for help echoes through election season
May 3, 2024 12:24 PM
Feroze Gandhi to Rahul Gandhi: Rae Bareli's tryst with Congress
May 3, 2024 11:36 AM
Rahul Gandhi to contest from Raebareli, close aide KL Sharma from Amethi
May 3, 2024 8:39 AM
BJP's Hindi heartland dominance faces test in phase 3 polls
May 2, 2024 9:14 PM