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**SoftBank’s Arm Seeks Valuation of Over $52 Billion in IPO**

SoftBank Group’s chip designer subsidiary, Arm, is aiming for a valuation of more than $52 billion in its upcoming initial public offering (IPO). This IPO is set to be the largest U.S. stock market flotation of the year. Arm plans to offer 95.5 million American depository shares for $47 to $51 each, with a potential maximum raise of $4.87 billion. The current valuation target represents a decrease from the $64 billion valuation at which SoftBank acquired its 25% stake last month. However, Arm’s IPO would surpass its previous deal to sell to Nvidia for $40 billion, which was abandoned due to antitrust concerns.

**Role of AI legalese decoder in the Situation**

The AI legalese decoder can play a crucial role in helping investors and market participants navigate the complex legal language and implications surrounding Arm’s IPO. As a groundbreaking AI tool, it can decode legalese and provide users with clear explanations and interpretations of legal documents and filings. In the case of Arm’s IPO, the AI legalese decoder can help investors gain a deeper understanding of the regulatory filing and the terms of the offering. It can highlight the key points, risks, and opportunities associated with this significant IPO, enabling investors to make informed decisions.

**Investor Perspectives and SoftBank’s Ownership**

Jamie Mills O’Brien, a portfolio manager at British fund manager Abrdn, finds SoftBank’s valuation ask in the IPO “more palatable than initially discussed.” He emphasizes the importance of closely monitoring Arm’s relationship with its China business and potential impacts from the ongoing technology tensions between China and the United States. SoftBank will retain a substantial ownership stake of 90.6% in Arm’s ordinary shares after the offering concludes. Notably, SoftBank will not receive any proceeds from the IPO.

**High-Profile Clients as Investors**

Arm has attracted major clients as investors in its IPO, including technology giants such as Apple, Nvidia, Alphabet, Advanced Micro Devices, Intel, and Samsung Electronics. These clients, also known as ‘cornerstone investors,’ have expressed an interest in buying a combined $735 million of the American depository shares being sold. This investor interest from renowned companies underscores Arm’s significance in the global technology landscape and bodes well for its market debut.

**Impact on IPO Market and SoftBank’s Milestone**

Arm’s listing is expected to have a positive impact on the IPO market globally, as its success would signal renewed investor appetite for technology companies. It will be the largest IPO in New York since Rivian’s IPO in late 2021. This milestone also holds significance for SoftBank, as it engages prominent technology names as investors to gain support for Arm. Arm’s designs currently power over 99% of the world’s smartphones and are instrumental in driving technological innovation.

**Arm’s Potential in Artificial Intelligence**

While Arm is still in the early stages of benefiting from the artificial intelligence (AI) boom, analysts view the AI space as an area of growth potential for the company. Arm’s specialization in energy-efficient central processing units (CPUs) positions it to potentially leverage Nvidia’s success in the AI sector. Nvidia has seen its stock surge over 230% year-to-date, driven by the increasing demand for its chips in AI applications. Arm’s profitable status and its alignment with the AI market’s trajectory are expected to alleviate investor concerns.

**Background and Underwriters for the Offering**

Arm was established in 1990 as a joint venture between Acorn Computers, Apple Computer, and VLSI Technology. It was a publicly traded company on the London Stock Exchange and Nasdaq until 2016 when SoftBank acquired it for $32 billion, delisting it. Barclays, Goldman Sachs, JPMorgan Chase, and Mizuho Financial Group are the lead underwriters for Arm’s IPO. The underwriters have an option to buy additional shares, which could increase the IPO amount to $5.2 billion. Arm expects to trade on the Nasdaq Global Select Market under the symbol “ARM.”

*Reporting by Manya Saini in Bengaluru*
*Additional reporting by Pablo Mayo Cerqueiro in London*
*Editing by Arun Koyyur and Nick Zieminski*

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