Thursday, June 15, 2023

Chips: "Arm Courts Intel as Anchor Investor in Upcoming IPO"

From Bloomberg

  • SoftBank-backed Arm is in talks with Intel, other companies
  • Arm is seeking to raise as much as $10 billion in IPO 

Arm Ltd., the chip designer backed by SoftBank Group Corp., is in talks with potential strategic investors including Intel Corp. to anchor what will be one of the largest initial public offerings of the year, people familiar with the matter said.

UK-based Arm has held talks with other companies about participating in the IPO, according to the people, who asked not to be identified discussing confidential information.
Talks are in the early stages and could still fall apart ahead of the listing, they said. It’s also unclear how much would be invested in Arm, or what the structure would be. Representatives for Intel and Arm declined to comment.

Shares in SoftBank rose as much as 7.7% in Tokyo on Tuesday. Intel shares were up less than 1% Tuesday morning in New York.

Arm is looking to raise as much as $10 billion in a New York listing later this year, having rejected repeated appeals from UK prime ministers to tempt the home-grown technology giant back to London, where it once traded. The lure of higher tech valuations and a deeper investor base in the US ultimately won out for Arm, which is expected to list on the Nasdaq exchange.

Build Momentum
Bringing on an anchor investor can help drum up interest and momentum in an IPO, especially in a rough market for new listings. If the talks succeed, Intel would eventually be listed in Arm’s IPO prospectus ahead of the listing.

Anchor investors buying $100 million to $200 million worth of shares have been popular for semiconductor-related IPOs in recent years. Growth equity firm General Atlantic invested about $100 million in Intel-backed Mobileye Global Inc.’s IPO last year while Qualcomm Inc. backed GlobalFoundries Inc.’s listing in 2021.

More: Understanding Arm’s Strategic Importance in Chips: QuickTake....


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