SoftBank’s Arm seeks to raise up to $4.87 billion in anticipated IPO

Arm Holdings Ltd., a subsidiary of SoftBank Group Corp., is proposing the largest initial public offering of the year, with an expected $4.87 billion in proceeds. This is significantly less than the once-obscure designer of phone processors had hoped to raise.

Arm filed with the US Securities and Exchange Commission on Tuesday to announce that it will sell 95.5 million American depository shares at $47 to $51 each.

Arm's original goal for the IPO was $8 billion to $10 billion, but this was dropped in part because SoftBank decided to buy the 25% stake held by its Vision Fund and hold onto a bigger number of the shares in the company. Arm's SEC filings reveal a valuation for the company in the Vision Fund transaction of more than $64 billion.

At first, the business wanted its IPO valuation to be between $60 billion and $70 billion; now, however, it wants to be valued at more than $50 billion.

Under the most conservative scenario, the IPO would raise $4.37 billion, making it the largest ever and well surpassing the debut of Johnson & Johnson consumer health spinoff Kenvue Inc. Arm's IPO might pave the way for IPOs by scores of software startups and other companies whose aspirations to go public in the US have been caught in the mud during the lowest, longest listing slump since the financial crisis of 2009.

Companies including Instacart Inc. (an online grocery delivery service), Klaviyo (an automated platform for marketing and data), VNG Ltd. (an internet company in Vietnam), and Birkenstock (a footwear manufacturer) have all filed for or are actively pursuing initial public offerings.

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A total of twenty-four underwriters are participating in Arm's offering, with Barclays Plc, Goldman Sachs Group Inc., JPMorgan Chase & Co., and Mizuho Financial Group Inc. serving as lead underwriters. Before it starts listing on the Nasdaq Global Select Market under the symbol ARM, Arm aims to change its name to "Arm Holdings Plc."

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