Arm delays IPO plans as recession shakes markets
British chipmaker Arm has pushed back its plans for an initial public offering this year as markets are roiled by recessionary fears and soaring inflation.
Cambridge-headquartered Arm, which is owned by troubled Japanese investment giant SoftBank, had been lined up for a return to the public markets after a blockbuster takeover deal by rival Nvidia collapsed.
However, the plans have now been put on ice with the market in turmoil and publicly listed tech firms suffering sharp falls in valuations.
“Given the state of the financial markets, it is unlikely that Arm will list in Q1 of 2023,” a spokesperson told City A.M.
“However, we are well advanced in our IPO readiness process and we remain fully committed to a 2023 listing.”
The comments followed a presentation by Arm’s investor relations chief last week who told the firm’s backers that the IPO was now unlikely to happen before the end of March 2023.
The comments come amid a torrid period for Softbank in which it has haemorrhaged cash for three consecutive quarters as its tech investments are hammered by inflation. The investor said it had lost $9.9bn in the three months to the end of September.
Softbank bosses have been on the receiving end of a major charm offensive from ministers and London Stock Exchange officials this year, in a bid to tempt them into floating Arm on its home market of London rather than New York.
However, Softbank founder and chief Masayoshi Son, who last week said he would “devote” himself to “Arm’s next phase of explosive growth”, has publicly favoured New York’s Nasdaq exchang, claiming the deeper investor pool will help fetch a higher valuation.
A snub by Softbank would be seen as a major blow to London’s global tech hub ambitions as it overhauls its capital markets to encourage more high growth tech businesses to list in London.