SoftBank’s Arm Aims to Raise at Least $8 Billion in U.S. IPO, Sources Say

Reuters

10:20 JST, March 6, 2023

NEW YORK, March 5 (Reuters) – Arm Ltd, the British chip designer owned by Japan’s SoftBank Group Corp 9984.T, is likely to aim to raise at least $8 billion from what is expected to be a blockbuster U.S. stock market launch this year, people familiar with the matter said on Sunday.

Arm is expected to confidentially submit paperwork for its initial public offering in late April, the sources said, speaking on condition of anonymity because the discussions are confidential. The listing is expected to happen later this year and the exact timing will be determined by market conditions, the sources added.

SoftBank has picked four investment banks to lead what is expected to be the most high-profile stock market flotation in recent years. Goldman Sachs Group Inc GS.N, JPMorgan Chase & Co JPM.N, Barclays BARC.L and Mizuho Financial Group 8411.T are expected to be the lead underwriters for the deal, the sources said, adding that no bank has been picked for the much-coveted “lead left” position yet.

The Australian Financial Review reported on the lead banks earlier on Sunday.

The preparations for the IPO are expected to be kick-started in the U.S. in the coming days, the sources said. The valuation range has not yet been finalized but Cambridge, England-based Arm is hoping to be valued at more than $50 billion during its share sale, the sources said.

Barclays, JPMorgan and SoftBank did not immediately respond to requests for comment. Arm, Goldman Sachs and Mizuho declined to comment.

A successful listing for Arm this year would provide a boost to the IPO market, which has been largely frozen since Russia’s invasion of Ukraine in February 2022 triggered market volatility and a huge sell-off in tech stocks.

The IPO market briefly flickered back to life last month as a number of companies including solar tech firm Nextracker Inc NXT.O and Chinese sensor maker Hesai Group HSAI.O listed their shares on U.S. stock exchanges, but investors still remain wary of betting on new stocks.

IPO advisors are not expecting a full-blown recovery in capital markets until the latter half of this year.

Arm said last week it would pursue a U.S.-only listing this year, dashing the British government’s hopes that the tech giant would return to the London stock market.

SoftBank has been pursuing a listing for Arm since its deal to sell the chip designer to Nvidia Corp NVDA.O for $40 billion collapsed last year because of objections from U.S. and European antitrust regulators.