SoftBank will retain a Majority Stake in Arm after its IPO

Japanese multinational conglomerate SoftBank Group Corp. expects to retain a controlling stake in Arm Ltd after its initial public offering of the chip business, according to people close with the matter. SoftBank is selling a smaller portion than initially estimated, SoftBank in the year 2016 acquired Arm Ltd. It opted for an IPO of Arm after a plan to sell the business to Nvidia Corp. failed earlier. As per the anonymous sources, SoftBank has decided that selling a smaller stake of Arm now, provides the opportunity to receive a higher valuation for the rest later, given the current fall in chip stocks.

The sources further said that SoftBank's raising of an $8 billion term loan secured with a stake in Arm also has provided the company with enough financial freedom to hold onto a bigger stake in the company and wait for better market conditions. The IPO is expected to happen in the first quarter of next year but the size and timing of the offering could change. Arm sells and licenses technology that is used by semiconductors in everything from smartphones to supercomputers.