SoftBank Group Corp.-backed British chip designer Arm said Monday it has filed to list its shares on the U.S. Nasdaq stock exchange, with its market capitalization estimated to exceed $60 billion in what could be the largest initial public offering this year.
The chip giant, whose technology powers most smartphones worldwide, is expected to go public in September, people familiar with the matter said, although it did not specify the timing of the listing or the offer price. SoftBank will continue to hold the majority of its shares.
The listing will supply the Japanese investment giant with much-needed funds to go on an offensive in a hunt for artificial intelligence-related start-ups after posting massive losses in the past few years.
A global market slump as well as rising interest rates worldwide has hurt SoftBank's investment portfolio. It incurred a record net loss of 3.16 trillion yen ($21.6 billion) in the April-June quarter last year, prompting CEO Masayoshi Son to declare he would curb investment and focus on increasing the value of Arm.
In recent months, however, the Japanese company has begun to express confidence in new investment, saying that the tide is turning with the emergence of generative AI such as ChatGPT.
At the company's annual shareholders' meeting in Tokyo in June, Son said Arm will play a central role in the evolution of AI as its chips will accelerate technological advances in the fast growing industry.
"Arm is now standing at the starting line for explosive growth," he said.
SoftBank acquired the British chip designer in 2016 for about 24 billion pounds ($30.6 billion), taking the company private in a bid to pursue business opportunities related to Internet of Things product network technologies.
However, faced with a worsening business environment due to the coronavirus pandemic, Softbank said in 2020 it would sell its entire stake in Arm to U.S. semiconductor maker Nvidia Corp.
In 2022, the company said it terminated the deal due to regulatory hurdles and said it would seek a public offering instead.
The Cambridge-based firm, widely considered one of the most valuable chip companies in the world, earns its revenue from designing chips and licensing its technology to semiconductor companies worldwide.
Its chips are used for various products from smartphones to laptops to cars, with the total shipment of chips designed by the company exceeding 250 billion units.
