ARM Shares Soar 25 Percent After Nasdaq Listing

ARM Holdings has enjoyed a successful public listing on the Nasdaq in New York on Thursday, in a positive development for owner SoftBank Group.

ARM’s shares soared almost 25 percent above their Nasdaq debut price, after opening at $56.10 from its advertised $51 per share price.

ARM’s share price closed at $63.59, rising 24.68 percent, and it is the largest public listing for 2023.

The floatation marked ARM’s return to the public market after a seven year absence. The Cambridge, UK-based firm had been dual listed in both London and New York until it was taken private by the £24 billion acquisition by SoftBank in 2016.

Successful IPO

The rise in ARM’s share price to $63.59 has also pushed the value of ARM from $54.5bn (£43.6bn) ahead of the listing, to a current valuation of $65 billion.

This new valuation exceeds the $64 billion valuation, at which SoftBank acquired the 25 percent stake in the company it did not already own from its Vision Fund last month.

SoftBank had previously been in talks to list ARM at a valuation of $60bn to $70bn.

The current $64 billion valuation is also above the $40bn (£32bn) SoftBank would have achieved through a sale of ARM to Nvidia that was abandoned last year following significant opposition from the tech industry and the British government.

“It is a successful IPO, Salman Malik, partner at Anson Funds in Toronto told Reuters. “It will have a positive impact on the IPO pipeline and shows the AI theme is alive and kicking.”

SoftBank still retains a 90.6 percent stake in ARM, after it was able to sell the 95.5 million ARM shares on offer – a 9.4 percent stake.

This makes ARM the most valuable company to list in New York since Rivian Automotive listed on the public markets back in November 2021.

Rivian is currently valued at $22.9bn.

Anchor investors

Last week ARM signed up many of its major clients as investors in its IPO, including the likes of Apple, Nvidia, Alphabet, Advanced Micro Devices, Intel, Samsung Electronics, Cadence Design Systems and Synopsys.

These strategic investors agreed to invest between $25 million and $100 million each in the blockbuster IPO.

ARM had spent months courting potential ‘anchor investors’ for its IPO, and there had been strong uptake due in part to tech firms seeking to expand their commercial relationship with ARM because of its unique importance in the tech sector.