Arm Holdings Ltd, a chip designer backed by SoftBank Group Corp (OTC: SFTBY) (OTC: SFTBF), has officially launched its roadshow for its highly anticipated initial public offering (IPO).
The company aims to convince investors that it's worth as much as $52 billion in what could be the most significant share sale of the year.
The roadshow commenced in Baltimore, the headquarters of influential asset manager T. Rowe Price Inc (NASDAQ: TROW), emphasizing the significance of the fund manager's role in significant IPOs.
T Rowe Price has been an anchor investor in notable IPOs, including electric car maker Rivian Automotive Inc (NASDAQ: RIVN) in 2021, valued at $66.5 billion.
SoftBank offers 95.5 million American depository shares of Arm for $47 - $51 each, potentially raising to $4.87 billion at the top of the range.
Arm's proposed valuation range is between $48 billion - $52 billion, possibly reaching $54.5 billion on a fully diluted basis.
The valuation represents a decrease from the $64 billion at which SoftBank acquired the 25% stake it didn't already own in Arm last month.
The market will closely watch the IPO for how Arm manages its relationship with its China business amid the ongoing technology tensions between China, and the U.S. SoftBank will retain 90.6% of Arm's ordinary shares after the IPO, with no proceeds going to the conglomerate.
Arm has secured significant clients like Apple Inc (NASDAQ: AAPL), Nvidia Corp (NASDAQ: NVDA), and Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) as cornerstone investors in its IPO.
Analysts suggest that Arm could benefit from the growing demand for artificial intelligence, riding on the coattails of Nvidia, which has surged in the AI sector. Arm's specialty in energy-efficient central processing units (CPUs) aligns with the AI boom, potentially driving its growth.
Arm expects to trade on the Nasdaq under the symbol "ARM" as it returns to the public markets.
Price Action: TROW shares traded higher by 0.97% at $112.90 premarket on the last check Wednesday.