Wall Street hopes that a September gold rush will start when SoftBank’s Arm files terms for its IPO after Labor Day. SoftBank’s chip CPU design unit Arm Holdings Ltd. (ARM proposed) is likely to disclose its IPO terms in an SEC filing at the crack of dawn on Tuesday (Sept. 5, 2023) as Wall Street gets back to work after the long Labor Day holiday weekend. Arm will start its roadshow Tuesday and price its IPO next week. Bloomberg reported that the Arm IPO may get priced as soon as Sept. 13 for a Thursday, Sept. 14, trade date on NASDAQ. Arm is the first of three tech unicorns expected to go public this month.
Arm – along with online grocery delivery app Instacart (CART proposed) and marketing automation platform Klaviyo (KVYO proposed) – could raise about $7.3 billion in combined IPO proceeds. That’s a tantalizing prospect in an IPO market that’s hungry for big deals after two hard years.
The latest estimates predict that Arm’s IPO alone could raise between $5 billion and $5.5 billion, which would make it the biggest IPO of 2023 – and the biggest IPO since EV maker Rivian (RIVN) went public in November 2021.
Arm is considering a valuation of about $50 billion to $55 billion, The Wall Street Journal reported. That level is “well below” the $64 billion valuation implied by SoftBank’s recent purchase of a remaining 25 percent stake in Arm from its Vision Fund, according to The WSJ.
The Arm IPO’s price range has been pegged at $47 to $51, according to Reuters.
All this is speculation, though, until Arm files its IPO terms with the SEC.
Veteran IPO pros say it’s essential that bankers price this one right.
Barclays, Goldman Sachs, JP Morgan and Mizuho are the lead joint book-runners.
Arm, based in Cambridge, England, says its CPUs are used in more than 99 percent of the world’s smartphones, according to the prospectus.
Slowing smartphone sales are a concern regarding Arm’s future prospects.
For the fiscal year that ended March 31, 2023, Arm said its total revenue was “relatively flat” at $2.68 billion, compared with $2.7 billion in the previous fiscal year, according to the prospectus. Arm said it earned net income from continuing operations of $524 million for the fiscal year that ended March 31, 2023.
Stay tuned.
(For more information about these companies, please check the IPO Calendar and the individual IPO Profiles found on IPOScoop.com’s website.)
Note: Never trade on proposed symbols. They have been known to change and you might buy something on the OTC Bulletin Board.
To see what time the NASDAQ IPOs are expected to trade, please log in to: NASDAQTrader.com then scroll down to IPO Message.
Disclosure: Nobody on the IPOScoop.com staff has a position in any stocks mentioned above, nor do they trade or invest in IPOs. The IPOScoop.com staff does not issue advice, recommendations or opinions.
Disclaimer: A SCOOP Rating (Wall Street Consensus of Opening-day Premiums) is a general consensus taken, at press time, from Wall Street and investment professionals concerning how well an IPO might perform when it starts trading. The SCOOP Rating does not reflect the opinions of anyone associated with IPOScoop.com. The SCOOP ratings should not be taken as investment advice. The rating merely reflects the opinion of the professionals at the time of publication and is subject to last-minute changes due to market conditions, changes in a specific offering and other factors, such as changes in the proposed offering terms and the shifting of investor interest in the IPO. The information offered is taken from sources we believe to be reliable, but we cannot guarantee the accuracy.