Arm Holdings IPO: SoftBank’s Chip Designer To Fetch At least $54.5 Billion Valuation In IPO, Says Report

SoftBank-backed Arm Holdings has received enough backing from investors to secure at least the top end of the share price in its initial public offering (IPO), commanding a $54.5 billion valuation on a fully diluted basis, people familiar with the matter were quoted as saying by Reuters.

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The sources further added that the chip designer has decided that it will only accept the top end of its indicated $47-$51 per share range or a price that is even higher, after reviewing the investor commitments.

Arm IPO shares are scheduled to be trading on Thursday. Arm is likely to price its IPO  above the indicated price range and will decide on how much it will sell its shares for on Wednesday, September 13, the sources further added.

The company was considering publishing its new revised price range,which would have been higher, showcasing investors' strong demand. The sources indicated that it chose not to pursue such a course of action, opting to maintain its conservative marketing approach for the offering. They also noted that setting a conservative price for the approximately $5 billion IPO increases the likelihood of the shares performing well during their debut on Thursday.

The valuation Arm has pursued recently marks a decrease from the $64 billion valuation when SoftBank acquired the remaining 25% stake in the company, which it did not already own, from its $100 billion Vision Fund last month. 

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Despite this reduced valuation, SoftBank would still come out ahead compared to its previous attempt to sell Arm to Nvidia Corp (NVDA.O) for $40 billion, a deal it abandoned last year due to antitrust regulatory challenges, according to Reuters report. SoftBank had taken Arm private in 2016 for $32 billion.