Apple, Samsung, and Intel to invest in Arm IPO, and emerge with some control: report UK-based chip designer Arm will be floated in September, and its biggest licensees will be among those bidding for big shareholdings on day one. So says Japan's Nikkei, which on Wednesday reported an IPO on the US NASDAQ index – an outcome that will not please the UK government, had lobbied for any float to be on a British …
I would love to be a fly on the wall of those board meetings. Samsung trying to push ARM for more development and higher performance mobile cores, Apple pushing for cutting costs to keep their SOC performance moat above and beyond Samsung/Qualcomm.
Sounds like the employees MAY escape in March 2024 with paper that is worth something, whether it is trading at 60billion Market Cap is another thing but it looks like ARMs woes are far from over. What a shame.
Not sure it would have been much different under Labour to be honest. The lesson they "learned" from the disastrous industrial policy of the 1970s was that government should stay out of industry. There's a lot to be said for this but regulators must then be given sufficient tools.
The difference MIGHT have been Corbyn would have invested public money in it to keep it in the UK (and even that is a slim chance), and the Murdoch empire would have every reader lapping up marxist Corbyn for doing so. You would also have all the Tory voting middle-managers in ARM Cambridge cursing Labour for not letting Softbank pay them a 50% premium on their shares.
ARM's fate was sealed long ago, in the late 90's to be precise, when it was taken public. From that time on greedy shareholder were waiting to sell their stock to the highest bidder, no matter what the consequences.
It's just good fortune that RISC-V came along or we'd all be screwed. ARM would forever be locked in war for control by different licensees trying to get a leg up on the competition.
There's no way ARM is worth $60 billion, that's just a paper valuation. No one in their right minds would ever pay that kind of money now that RISC-V is making inroads. My guess the company is worth maybe $5 billion at the most. When this becomes reality Softbank will be left holding the bag.
Even I am skeptical on their IPO but this is ridiculous, their Revenue is ~3 billion with something like 30-40% margins.
It will fetch whatever this conglomerate of customers are willing to pay to get control. As for what it is trading at after the banks offload their shares and Softbank need to stay afloat is another story by the time the employees are able to sell their stock.
Sadly people don't understand this industry and think ARM will be a growth stock, it is a value stock trying to be turned into a growth stock and the customers are getting pissed off.
There's also Qualcomm.
If each of those five bought 10% they'd have enough voting power collectively to veto anything particularly stupid ARM's management tried to do. And they all have enough money that they don't have to care about long term return - it would be more of a protective move than an investment expecting direct ROI.
Nowhere does it say that, it says it is unknown what Softbank may end up holding onto.
If they can't collectively buy 50% then at least a couple of them will want to buy enough to have a board seat so they can be aware of dumb stuff they're planning to do in advance.
>” They're not THAT stupid”
From a previous press release, I would not be so sure…
A stock market listed company is a legal entity in its own right and has to product financial reports of its activities, yet SoftBank have stated “ SBG does not expect that any such offering would have a material effect on its consolidated results or financial position.” which would seem to imply they believe they can simply include the financials of ARM in the SBG financial statements and that ALL trading surpluses accrue to SBG and not to any other shareholder in ARM.
I also expect SBG, because of their poor financial status, will be wanting to appropriate ALL monies received from the listing ie. Leave ARM with minimal reserves.
So having some major ARM customers involved could be a good thing. Personally, if any the named companies wash their hands and walk away, I would be strongly tempted to give the ARM IPO and listed stock a miss…
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