Arm accelerates transfer of stake in Chinese joint venture, continues IPO plans

The Financial Times, citing people familiar with the matter, reported that Arm is planning to transfer its stake in the Chinese joint venture to a special purpose vehicle (SPV) under Japan’s SoftBank Group to accelerate Arm’s initial public offering (IPO).

Since Arm holds a 47.3% stake in the Chinese joint venture, if the share transfer is successful, the Chinese joint venture and Arm headquarters will maintain a license rather than a shareholding relationship. Arm will also continue to receive licensing revenue from the Chinese joint venture without reviewing its financials.

Arm declined to comment at this time. Japan’s SoftBank Group also did not respond to the report.

Reuters previously reported that SoftBank Group plans to cooperate with foreign investment Goldman Sachs, with Goldman Sachs serving as the lead underwriter for the Arm IPO. The market valuation of the Arm IPO market may be as high as $60 billion, and Arm plans to list on the US stock market Nasdaq by March 2023.

The latest research report of TrendForce, a market research and research organization, shows that in recent years, enterprises’ demand for digital transformation such as artificial intelligence and high-performance computing has accelerated, which has led to an increase in the proportion of cloud adoption. By 2025, the penetration rate of ARM-based data center servers will reach 22%.

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