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Arm snubs UK for US listing – but is open to future London IPO

Image credit: Arm

SoftBank, the owner of Cambridge chip designer Arm, has selected the US for its long-awaited public listing in a rebuff of the UK’s tech IPO market.

While SoftBank’s decision will come as a blow to the UK politicians who had been lobbying for a blockbuster London IPO, Arm’s chief executive provided a glimmer of hope that a separate public listing in the capital is not entirely off the table.

Japan’s SoftBank selected the US Nasdaq over the London Stock Exchange in an IPO expected to value Arm at a range of $30bn to $70bn, according to Bloomberg.

Rene Haas, chief executive of Arm, said: “After engagement with the British government and the Financial Conduct Authority over several months, SoftBank and Arm have determined that pursuing a US-only listing of Arm in 2023 is the best path forward for the company and its stakeholders.”

Arm, which designs processing technology used in most of the world’s smartphones, has also announced plans for a new Bristol location in a boost for the UK’s regional tech hubs.

The company added that it will keep its headquarters, operations and material IP within Britain.

A representative for the government said: “The UK is taking forward ambitious reforms to the rules governing its capital markets, building on our continued success as Europe’s leading hub for investment, and the second largest globally.”

“We continue to attract some of the most innovative and largest companies in the world – and note Arm’s commitment to expanding its presence in the UK, providing a boost to growth, jobs and investment.”

The UK’s last three prime ministers have all lobbied for Arm to list in London, with Rishi Sunak last month meeting with Haas and Softbank CEO Masayoshi Son.

‘Lack of faith’ in UK tech

Arm, which was founded in 1990, completed a dual listing in the UK and the US in 1998. It was then acquired and taken private by SoftBank in 2016 for $32bn. In 2020, US chip company Nvidia attempted to acquire Arm but later abandoned its offer following regulatory concerns.

Haas added: “Arm is proud of its British heritage, and continues to work with the British Government. We will continue to invest and play a significant role in the British tech ecosystem. Arm also intends to consider a subsequent UK listing in due course.”

Russ Shaw, founder, Tech London Advocates and Global Tech Advocates, said: “There are glimpses of hope from Arm that they still recognise a commercial value in keeping roots in the UK.

“For example, they are keeping their headquarters and material IP in Cambridge and that they plan to open a site in Bristol – but it’s a far cry from an LSE listing and demonstrates a lack of faith in the UK.”

Shaw added that the Arm US IPO adds pressure on the government to publish its “long-awaited semiconductor strategy”.