Arm Expected to File IPO Documents Soon, Could Be Biggest U.S. IPO in Two Years

Arm, which designs semiconductors and other microtechnologies used in computers, is currently majority owned by Japan's Softbank. According to media reports, SoftBank recently acquired a 25% stake in Arm from its venture capital subsidiary, Vision Fund, in a deal valuing Arm at about $64 billion.

In April, Arm announced that it had filed confidential preliminary IPO documents with U.S. regulators, and Bloomberg reported last week that Arm's formal IPO application could be filed as early as next Monday, with plans to go public next month in an IPO of $8 billion to $10 billion.

If the filing is successful, it would be the largest U.S. IPO to date since electric car maker Rivian's $13.7 billion IPO in November 2021. before that, the largest U.S. IPO since Rivian came from Johnson & Johnson subsidiary Kenvue, which went public in May of this year and traded for about $4 billion, while Arm's 's IPO will be twice as large.

In fact, Arm had agreed to sell itself to generative artificial intelligence darling Nvidia for $40 billion in 2020, but regulatory scrutiny ultimately nixed the deal.Arm would be entering a public market of eagerly transforming tech companies, as evidenced by Nvidia's stock soaring more than 200 percent this year and chipmakers AMD, Intel and TSMC's outperforming the broader market as an example.

Despite high expectations and goodwill, Arm will need to quickly justify its high valuation; the Cambridge-based company will disclose in its IPO filing that its sales slipped 1 percent in the first 12 months ended March 31 of this year, according to Reuters. $Arm Holdings(ARM.US)$ $SoftBank Group (ADR)(SFTBY.US)$ $Rivian Automotive(RIVN.US)$