Amazon is looking to raise between $8 and $10 billion as it actively engages in talks with other tech companies to become the anchor investor for SoftBank's Arm ahead of its potential initial public offer (IPO). That could materialize as soon as September, as reported by Reuters.
SoftBank plans to apply to the US Securities and Exchange Commission (SEC) for the listing later this month before getting approval from the Nasdaq. Nikkei Asia reports that Apple, Samsung Electronics, Nvidia, and Intel will invest in Arm as soon as the company is listed on the market. Amazon plans to raise as much as $10 billion, making it the ARM IPO's anchor investor.
Nikkei says Softbank plans to sell 10-15% of Arm shares to the open market. In 2021, Nvidia announced that it would acquire Arm for $40 billion. Regulatory challenges, however, dealt severe fatal blows to the arrangement, resulting in Nvidia's decision to abandon the deal the following year.
After the deal was axed, there was much speculation that Arm would go public. Should everything work out, this would make Arm's IPO the biggest initial public offering of the year. Even Arm China's rogue CEO (a long but amazing story) said the failed Nvidia buyout "could be a better path for Arm."
Before the news of Amazon's prospective investment surfaced, Arm's post-public debut market valuation stood at $60 billion. With Amazon's infusion of $10 billion, the chip maker's valuation is expected to soar to nearly $70 billion.
ARM CPUs are expected to own 30% of the PC market by 2026. We only see ARM-based CPUs in Apple Macs, various Chromebook brands, and pretty much most smartphones on the planet—but no gaming PCs. So it's interesting to see chipmakers like Intel and Nvidia looking to invest heavily into the chip design unit of SoftBank and becoming stakeholders themselves.