Arm is scheduled to start trading on the Nasdaq later today after pricing its IPO shares at $51 each, translating to a market capitalisation of $54.5 billion. The company plans to list at least 95.5 million American depository shares on the Nasdaq, and SoftBank, its current owner, will control about 90% of the company’s outstanding shares.
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The ADSs are expected to begin trading on the Nasdaq Global Select Market (Nasdaq) on September 14, 2023, under the ticker symbol “ARM.” The selling shareholder, that is, a SoftBank subsidiary, has allowed underwriters the option to purchase up to an additional 7,000,000 ADSs to cover over-allotments in the next 30 days after the date of the final prospectus.
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The IPO is expected to close on September 18, 2023, subject to customary closing conditions. The IPO price is at the top of the initial range of $47 to $51 given by the company at the filing of its IPO documents. The company has sold 95.5 million ADSs to raise about $4.87bn for its Japanese owner, the SoftBank Group.
Arm customers, including Google, Apple, Nvidia, Advanced Micro Devices, Alphabet, Intel and Samsung, said they would invest in the IPO. The Arm IPO has attracted much interest from investors as it is the second-largest US IPO of the year, given the amount raised and the company's overall valuation.
The UK missed out on the potential listing of Arm shares on the London Stock Exchange after Arm said in March that it had decided not to list its shares in the UK and would focus solely on the US listing. Some experts blamed the UK’s departure from the European Union as the primary factor behind the missed listing.
Investors eagerly wait for the US markets to open to see how Arm shares will trade on their first day after the IPO. A higher rally would signal demand for the chip manufacturer's shares and that the pubic markets want to get a piece of the company. A decline would signal that the public markets think the company should be priced lower due to less demand.
As I have mentioned in past articles, Arm plays a critical role within the global semiconductor industry as its chip designs can be found in almost all the smartphones manufactured globally.
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