Another highly-anticipated initial public offering (IPO) is one step closer to listing, as SoftBank's chip maker Arm has confidentially filed a registration statement to the U.S. Securities and Exchange Commission (SEC) this week.
While the size and price range of the proposed offering have yet to be determined, Reuters reports that Arm plans to raise between $8 billion and $10 billion. That listing could make Arm one of the largest IPOS in the last decade in the U.S., let alone one of the biggest offering in a pretty muted market so far this year.
The first-quarter saw just 29 IPOs raise a total of $2.3 billion, according to research from Renaissance Capital, continuing 2022's low trends as market participants contend with a hawkish Federal Reserve, recession fears, and increased volatility in the wake of March's banking sector turmoil.
Still, last quarter's performance outpaced 1Q 2022 and the market seems to be heating up as many hot IPOs have filed to go public sometime in 2023. Notably, Johnson & Johnson (NYSE: JNJ) plans to list its consumer health spin-off Kenvue on the New York Stock Exchange this week in a deal that is expected to raise $3.5 billion.
SoftBank has been looking to offload its Arm business since the chip maker's $40 billion deal with Nvidia (NASDAQ: NVDA) faced antitrust concerns from U.S. and European regulators. Arm has since continued to be an industry standout, with sales up 28% in its most recent quarter, Reuters reports as its focus on data center servers and personal computers generating higher royalty payments.
Arm also designs the processor technology used in most smartphones, with its business competing with other industry leaders like Intel (NASDAQ: INTC) and Nvidia.
SoftBank is also looking for a performance turnaround after reporting a net loss of $5.9 billion in its most recent earnings report, as its Vision Fund segment lost more than $4.5 billion due to declining valuation for companies within its investment portfolio. That disappointing report came after founder Masayoshi Son left the company after years of failed start-up bets, notably including WeWork.
Arm's IPO is being led by Goldman Sachs (NYSE: GS), JPMorgan Chase (NYSE: JPM), Barclays (NASDAQ: BAR) and Mizuho Financial Group.