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After failing to secure an acquisition deal with Nvidia last year, semiconductor design company ARM is planning to go public. It wants to sell its shares on the New York-based stock exchange Nasdaq later this year. Ahead of the planned IPO (initial public offering), the SoftBank Group-owned British firm is reportedly seeking to bring on one or more anchor investors to the table. It’s in talks with at least ten companies, including Intel, Google parent Alphabet, Apple, Microsoft, TSMC, and Samsung, Reuters reports.
According to the new report, ARM is looking to raise about $8-10 billion in anchor investment from these firms. This investment will come against shares in the company at a fixed price before the IPO. The plan is to bolster the demand for its shares and boost the confidence of potential investors in the IPO by getting some big names on board early. However, anchor investors will not get any board seats or control over the company. These investors only get to buy ARM shares ahead of the IPO.
A couple of sources familiar with the matter told Reuters that talks are still in the preliminary stage. ARM appears to be simultaneously discussing multi-billion anchor investments with several firms. The final decision may not come before August, though. Interestingly, some of the companies ARM is in talks with are already its customers. It’s unclear if an anchor investment from one or more of those companies will have any impact on their commercial relationships with the British chip designer.
ARM is in talks with multiple companies for anchor investment
ARM is one of the biggest names in the semiconductor industry. The Cambridge, England-based company designs CPU cores used by pretty much every chipmaker, including Qualcomm, Samsung, MediaTek, and others. Japanese conglomerate SoftBank Group has owned ARM since 2016 after acquiring it for $32 billion. In 2020, SoftBank Group reached an agreement with California-based Nvidia to sell the firm for $40 billion. The purchase was expected to complete in 2022 but numerous regulatory hurdles eventually forced the two parties to call off the deal.
A few other companies have since shown interest in acquiring ARM from the Japanese conglomerate, including Qualcomm. Samsung Chief Lee Jae-yong also met SoftBank founder and CEO Masayoshi Son in October last year, sparking ARM acquisition rumors. But it appears ARM has set its mind on an IPO after the failed deal with Nvidia. It has already begun preparations for a stock market listing later this year and has filed necessary regulatory applications. It remains to be seen if the company manages to get a few anchor investors on board ahead of that.
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