The British semiconductor design company Arm has declared its intention to offer shares for sale in the United States. The renowned firm, headquartered in Cambridge, is renowned for creating chips used in various devices such as smartphones and gaming consoles. It is planning to go public on New York’s Nasdaq stock exchange in September.
While the specific number of shares to be sold and the pricing details have not been disclosed, the projected initial public offering (IPO) could be the most significant listing since late 2021. Arm, which had previously considered listing shares in London, chose to go ahead with the IPO in the US instead. The company recently announced the submission of a registration statement for the IPO, including details about the number of shares to be offered and their expected price range, which is estimated to be between $60 billion and $70 billion.
Arm, acquired by Japanese conglomerate Softbank in 2016 for £23.4 billion, has historically provided chip design blueprints and technologies utilized by major manufacturers like Apple, Samsung, and Taiwan Semiconductor Manufacturing Company to develop their own chips. The firm’s decision to list on a stock exchange will transform it from a private entity to a publicly traded company, allowing investors to purchase and sell shares on specific stock exchanges.
Although Arm had considered a UK listing, it concluded that pursuing a listing in the US was the optimal course of action. The move sparked discussions about the UK’s competitiveness in attracting tech company listings compared to the US exchanges, known for offering higher visibility and valuations. However, Arm’s CEO, Rene Haas, confirmed that the company’s critical intellectual property, headquarters, and operations will remain in the UK.
Softbank’s commitment to proceeding with the multi-billion-dollar sale highlights its determination, even amidst challenging conditions in global financial markets that have been impacted by events like Russia’s invasion of Ukraine and the ongoing COVID-19 pandemic. The semiconductor industry, following a period of high demand during the pandemic, has recently faced decreased demand.
Arm’s recent financial performance has been affected, with sales dropping to $2.68 billion for the year ending March 31, mainly due to a decline in global smartphone shipments. Additionally, sales for the quarter ending June 30 decreased by 2.5% to $675 million.
