Softbank to choose Goldman Sachs as lead underwriter for $60 billion US IPO
Goldman Sachs will underwrite IPO for Arms Ltd
SoftBank asked investment banks to commit to providing a credit line
Japanese conglomerate SoftBank Group Corp chose Goldman Sachs Group Inc (NYSE: GS) as the lead underwriter for the IPO of British chip designer Arm Ltd. The IPO could value the company as much as $60 billion, Reuters reported.
The preparations for an initial public offering come after Nvidia Corp (NASDAQ: NVDA) was forced to call off the $40 billion deal to acquire SoftBank’s Arm due to objections from U.S. and European antitrust regulators.
Last month, SoftBank said it would list Arm on Nasdaq by March 31, 2023.
The report said in the last few weeks, SoftBank interviewed investment banks for the IPO and asked them to commit to providing a credit line.
Although it is unknown how much Goldman Sachs has offered for a credit line, Bloomberg last month reported that SoftBank was asking banks for an $8 billion margin loan tied to Arm’s IPO stock.
“We will aim for the biggest IPO ever in semiconductor history,” SoftBank founder Masayoshi Son told investors about Arm’s listing last month.
However, the sources told Reuters that the plans were subject to market conditions, and Softbank may choose not to proceed with the deal.
Chip designing giant
Arm, whose technology powers Apple Inc’s (NASDAQ: AAPL) iPhone and nearly all other smartphones which use Qualcomm Inc’s (NASDAQ: QCOM) chips, was taken private in 2016 by the Japanese giant for $32 billion.
Earlier Softbank has said, Arm’s net sales surged 40% to $2 billion in the nine months to December amid high demand for chips.
Although SoftBank announced a deal to sell Arm to Nvidia in September 2020, the U.S. Federal Trade Commission (FTC) blocked the deal, arguing that the acquisition would cause harm to competition in developing markets for chips in self-driving cars and a new category of networking semiconductors.
The deal also faced scrutiny from regulators in the United Kingdom and the European Union and had yet to receive approval in China.
Picture Credit: CNBC
