Softbank-Backed Chip Designer Arm Aims for $60B-$70B IPO Valuation Amid Bullish AI Chip Outlook

Softbank Group Corp SFTBF SFTBY backed British chip designer Arm Ltd is eying an initial public offering at a valuation of $60 billion - $70 billion by September.

Arm's move marks its bullish take on artificial intelligence chips. The roadshow will likely start the first week of September, with pricing for the IPO the following week, Bloomberg cites familiar sources.

Also Read: Softbank-Backed Arm Eyes Commercial Blockbuster Products Ahead Of IPO, Shelves Flagship Division

Earlier in 2023, bankers pitched a range of valuations from $30 billion to $70 billion. SoftBank's Masayoshi Son and Arm CEO Rene Haas long considered the bottom of that range too low.

The chip designer looks to raise $10 billion in the IPO. Arm confidentially filed for a U.S. listing in April.

Nvidia Corp NVDA, after its botched takeover attempt of Arm and Intel Corp INTC, engaged in preliminary talks to become anchor investors in the IPO. Softbank's deal to sell the chipmaker to rival Nvidia collapsed in early 2022 due to regulatory opposition.

Arm sells the blueprints needed to design microprocessors and licenses technology known as instruction sets that dictate how software programs communicate with those chips, making the chip designer's technology ubiquitous on phones.

Haas, who became CEO in 2022, targeted more advanced computing, particularly the chips for data centers for cloud computing and artificial intelligence applications.

Amazon.com Inc AMZN has adopted Arm-based chips for its Amazon Web Services, citing its efficiency both in terms of energy and economics. 

Price Action: SFTBF shares closed higher by 1.85% at $50.99 on Tuesday.

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