At last. SoftBank Group Corp.’s semiconductor subsidiary Arm Holdings Ltd. (ARM proposed) filed its F-1 late Monday afternoon (Aug. 21, 2023) without disclosing terms in what will be 2023’s biggest IPO. The filing ended Wall Street’s watch party of the last few weeks. Arm’s IPO could raise about $8 billion to $10 billion, according to Bloomberg. The deal will be the biggest U.S. IPO since EV maker Rivian Automotive, Inc.‘s (RIVN) $11.93 billion IPO in November 2021. This is a NASDAQ listing.
Arm’s IPO is viewed as the deal that will bring the U.S. IPO market back to life after two harsh years following the IPO boom of 2020 and 2021.
“The company plans to start its roadshow the first week of September and price the IPO the following week, seeking to be valued in the listing at $60 billion to $70 billion,” Bloomberg reported.
Barclays, Goldman Sachs, J.P. Morgan and Mizuho are the global joint book-runners. The book-running team totals 14 banks, including BofA Securities, Citigroup, Deutsche Bank Securities, Jefferies, BNP PARIBAS, Credit Agricole CIB, MUFG, Natixis, Santander and SMBC Nikko.
The co-managers team totals 14 banks: BMO Capital Markets, Daiwa Capital Markets America, Evercore ISI, Guggenheim Securities, HSBC, IMI – Intesa Sanpaolo, Independence Point Securities, KeyBanc Capital Markets, Loop Capital Markets, Ramirez & Co., Inc., Rosenblatt, Societe Generale, TD Cowen and Wolfe / Nomura Alliance.
The IPO will be an offering of American Depositary Shares (ADS) – all offered by SoftBank Group Corp., the selling shareholder. Each ADS will represent one ordinary share. The company will not receive any proceeds from the IPO.
Running Most of the World’s Software
Arm Holdings, based in Cambridge, England, created the Arm CPU (central processing unit) architecture that runs most of the world’s software, including the operating systems and applications for smartphones, tablets, personal computers, data centers and networking equipment and vehicles, as well as the embedded operating systems in devices such as smartwatches, thermostats and industrial robotics, according to the prospectus.
“We estimate that approximately 70 percent of the world’s population uses Arm-based products, and the scale of Arm’s reach continues to expand, with more than 30 billion Arm-based chips reported as shipped in the fiscal year ended March 31, 2023, alone, representing an approximately 70 percent increase since the fiscal year ended March 31, 2016,” the prospectus says.
For the fiscal year that ended March 31, 2023, Arm Holdings Ltd. reported $524 million in net income from continuing operations on total revenue of $2.679 billion, the prospectus says.
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