The top two smartphone manufacturers in the world, Samsung and Apple, among others, have agreed to invest in ARM’s initial public offering. Although it should be noted that the latest objective is really a step down from the $64 billion valuation at which SoftBank acquired its 25% investment in the company, the British chip design firm is now aiming for a valuation between the $50 billion and $55 billion level.
According to Reuters, significant players in the technology and chip industries, besides Apple and Samsung, have agreed to invest in the IPO, including AMD, NVIDIA, Intel, Cadence Design Systems, Synopsys, and Alphabet.
According to recently disclosed information, there are discussions to bring on additional investors since ARM may want to come close to reaching the goal valuation.
The report claims that NVIDIA, Apple, and other companies have committed to invest between $25 million and $100 million in the IPO, with ARM and SoftBank setting aside 10% of the shares to be sold in the IPO. Individual firm investment amounts have not been disclosed. Earlier, there were discussions about include Amazon in the group of investors, but the retail behemoth has withdrawn from the agreement for unknown reasons.
It is not at all surprising that Samsung and Apple would be involved in the mix given that both businesses now appear to have a stake in the company and may have an advantage in the market as a result of their investment in ARM’s IPO. Samsung may exploit this business partnership to mount a comeback while Apple will try to solidify its dominance in the ARM notebook and desktop market.
It should be reminded that taking part in ARM’s IPO will not grant you any strategic advantages, nor will the British chip design company treat you better than anyone else. However, each company’s participation makes it more difficult for a rival to later buy ARM.
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