Arm, the Cambridge-based microchip designing giant, has filed to sell its shares in the US, with reports suggesting it aims to raise up to $10 billion (£ 8 billion) through an initial public offering (IPO).
The move is a blow to the UK, as Arm has decided not to list its shares in London.
Softbank, the Japanese conglomerate that purchased Arm for £23.4 billion in 2016, has submitted a draft registration statement for the IPO to the US Securities and Exchange Commission (SEC).
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The timing and value of the IPO have not been disclosed.
According to reports, Arm is seeking to raise between $8 billion and $10 billion through the listing this year on the technology-heavy Nasdaq platform.
Arm’s chip designs are used by major manufacturers such as the Taiwan Semiconductor Manufacturing Company and technology giants like Apple and Samsung.
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After the acute shortage of semiconductors during the pandemic, the chip-making industry has faced slowing demand, with companies such as Intel and Samsung posting major losses.
Arm’s decision not to list in London has come as a disappointment to the UK, as the company was considered a “crown jewel” of the country’s technology sector, and its loss marks a significant blow to the country’s efforts to boost its tech industry.
In January, reports suggested that UK Prime Minister Rishi Sunak had restarted talks with Softbank about a possible London listing, but Arm has now decided that a sole US listing is the best path forward.
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Softbank’s decision to push ahead with the multi-billion-dollar sale despite difficult conditions in global financial markets shows its determination to recover losses faced by its Vision Funds, which have suffered from declining valuations of many of its investments in technology start-ups.
The successful stock market listing of Arm would provide welcome news for Softbank, which called off its planned $ 40 billion sale of Arm to technology group Nvidia last year after facing regulatory hurdles in the UK, US and EU.
The decline in stock market listings since Russia’s invasion of Ukraine and the pandemic’s impact on the shares of major technology companies have further complicated Arm’s IPO.
The company has stated the listing is “subject to market and other conditions and the completion of the SEC’s review process.”
Arm was founded in Cambridge in 1990 and has long been a leading player in the microchip design industry.
Its chip designs, which are used in a wide range of applications, are some of the most widely used in the world.
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Arm was previously listed in London and New York, but the decision not to list in London highlights the UK’s struggle to retain its leading technology companies in the country.
The UK government has responded by launching a range of initiatives designed to support the country’s tech industry, including the creation of a £375 million fund to invest in fast-growing companies.
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However, despite these efforts, many of the country’s leading tech companies have decided to list overseas, with the UK lagging behind other countries in terms of the number of IPOs.
The UK government will now be hoping that it can attract other technology companies to list in the country to prevent a further loss of talent and investment.
Arm’s decision to list in the US marks a significant blow to the UK’s efforts to boost its tech industry, as it is considered one of the country’s leading technology companies.
Softbank’s determination to recover losses through the IPO highlights the challenging conditions facing the global financial markets
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