Arm Holdings, a UK-based chip designer for smartphones and other markets, announced terms for its IPO on Tuesday.
The Cambridge, UK-based company plans to raise $4.7 billion by offering 95.5 million ADSs (100% secondary) at a price range of $47 to $51. Certain cornerstone investors, including Intel and NVIDIA, intend to purchase $735 million worth of ADSs in the offering (16% of the deal). At the midpoint of the proposed range, Arm Holdings would command a fully diluted market value of $50.8 billion.
At $4.7 billion, Arm is slated to be the largest IPO of 2023, and the largest deal since Rivian (RIVN) in late 2021. The offering would raise nearly $1 billion more than the year's current leader, J&J spin-off Kenvue (KVUE).
Arm believes it is the industry leader of central processing units (CPUs), creating and licensing high-performance, low-cost, and energy-efficient CPU products and related technology. The company states that its energy-efficient CPUs enabled advanced computing in over 99% of the world's smartphones in 2022, as well as over 250 billion chips, cumulatively. It estimates that approximately 70% of the world's population uses Arm-based products, with more than 30 billion Arm-based chips reported as shipped in the FY23.
Arm Holdings was founded in 1990 and booked $2.7 billion in revenue for the 12 months ended June 30, 2023. It plans to list on the Nasdaq under the symbol ARM. Barclays, Goldman Sachs, J.P. Morgan, Mizuho Securities, BofA Securities, Citi, Deutsche Bank, Jefferies, BNP Paribas, Credit Agricole CIB, MUFG, Natixis, Santander, and SMBC Nikko are the joint bookrunners on the deal. It is expected to price during the week of September 11, 2023.
