SoftBank's Arm IPO currently six times oversubscribed-source

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Illustration shows Arm Ltd logo

The Arm Ltd logo and a rising stock graph are seen in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration Acquire Licensing Rights

NEW YORK, Sept 8 (Reuters) - Arm Holdings Ltd, the chip designer owned by SoftBank Group Corp (9984.T) that is seeking roughly $5 billion in its initial public offering (IPO), has seen investor demand that is six times the amount it is asking for, a person familiar with the matter said on Friday.

While the oversubscription does not guarantee strong IPO performance, it is a positive sign for Arm. It makes it more likely that the company will, at a minimum, reach its targeted price range of $47 to $51 per share, the source said.

That price range values Arm at between $50 billion and $54.5 billion at a fully diluted bases. This would represent a climb-down from the $64 billion valuation at which SoftBank last month acquired the 25% stake it did not already own in the company from its $100 billion Vision Fund.

It remains unclear whether Arm will attract enough investor demand to seek a higher valuation ahead of its IPO pricing on Sept. 13.

The source requested anonymity because the matter is confidential. Arm declined to comment. The Financial Times reported earlier on Friday that the IPO was oversubscribed.

Reporting by Echo Wang in New York Editing by Greg Roumeliotis

Our Standards: The Thomson Reuters Trust Principles.

Echo Wang is a correspondent at Reuters covering U.S. equity capital markets, and the intersection of Chinese business in the U.S, breaking news from U.S. crackdown on TikTok and Grindr, to restrictions Chinese companies face in listing in New York. She was the Reuters' Reporter of the Year in 2020. Contact: +9172873971

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