CNA – Customers of Arm Holdings Ltd including Apple Inc, Nvidia Corp, Alphabet Inc and Advanced Micro Devices Inc have agreed to invest in the chip designer’s initial public offering (IPO), according to people familiar with the matter.
Intel Corp, Samsung Electronics Co Ltd, Cadence Design Systems Inc and Synopsys Inc have also agreed to participate as investors in the offering, the sources added. The talks are ongoing and some other potential investors are also in discussions to invest in the IPO, the sources added.
SoftBank Group Corp, which owns Britain-based Arm, is targeting a valuation between USD50 billion and USD55 billion. Arm’s clients have agreed to invest in that valuation range, the sources said.
While it is possible that demand for Arm’s shares will lead to a higher valuation by the time the IPO prices, the move represents a climb-down from the USD64 billion valuation at which SoftBank acquired the 25 per cent stake in the company it did not already own from its USD100 billion Vision Fund last month.
Apple, Nvidia and the other strategic investors have agreed to invest between USD25 million and USD100 million each in the blockbuster IPO, the sources said. Arm and SoftBank have set aside 10 per cent of the shares to be sold in the IPO for its clients.
