The British software and semiconductor design company Arm, which went public on Wall Street this Thursday, closed with a rise of 24.69% and reached $63.59 per share. This is the largest IPO of 2023, starring one of the companies that accumulate the greatest geostrategic value of the moment due to the growing tension between the US and China over control of semiconductors.
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At noon the shares began trading on the Nasdaq with the symbol ARM, their Initial Public Offering Price (IPO) was $51 and within 5 minutes of their release their shares rose more than 10%. The maximum price that the shares achieved on their first day on the New York stock market was $65.50.
The UK-based company designs chip parts for nearly every smartphone in the world, as well as Apple computers, Amazon data centers and cars. On August 22, Arm filed to go public on the Nasdaq index in New York.
The Japanese company Softbank acquired Arm in 2016 for around $32 billion, which meant it went private. In 2020, it agreed to sell it to the American company Nvidia for around $40 billion, although that operation was canceled in 2022, after objections from regulators and its competitors.
In early 2023, it was made public that Softbank was considering listing in the US in order to recover its investment in the purchase of Arm, given the higher valuation that US investors give to stocks in the technology sector. SoftBank will sell 95.5 million shares of the company – around 10% of the capital – and aims to raise more than $4.87 billion, but hopes to keep the remaining shares.
In the coming days, large companies and investors that have purchased share packages in Arm must notify financial regulators and the owners of that 10% of securities that Softbank intended to get rid of will be known. Intel, TSMC, Nvidia, Samsung, Apple and Google and other multinationals are the main candidates, according to analysts.
Arm posted $2.68 billion in revenue in its last fiscal year, which ended in March, and made $524 million in profit during that period. But beyond its economic capacity lies its geostrategic value, being the only large European chip farm and the growing tension between the US and China over the domination of semiconductors, a key component for digital life.