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Government mulled use of national security laws to force Arm London listing

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Ministers mulled the use of national security laws to push Japanese investment giant Softbank into floating chip manufacturer Arm into a London listing, according to reports.

The government debated applying the UK’s National Security and Investment Act in a bid to stop Arm floating in New York, but reportedly pulled back after some government officials pushed back against the idea, The Financial Times reported, citing sources close to the matter.

Concerns were reportedly raised over how applicable the regulation would be, given the proposed listing was not considered an acquisition.

Ministers instead launched a charm offensive on Arm bosses, with digital minister Chris Philp and investment minister Gerry Grimstone meeting with Softbank bosses over the past months, and Boris Johnson writing to SoftBank to tempt them into floating the firm in the capital.

However, suggestions that the government had considered the use of national security laws have reportedly irked SoftBank executives, the FT reported, as a deeper tech investor pool in the US meant a New York made more business sense to the firm.

A source close to the development of National and Security Investment Act, which was introduced in in January, told Morning Wire that such a move by government would not be possible under the legislation, however.

Speaking today, the prime minister’s spokesman said he was not aware of any plans to try to compel chip designer ARM to list in London.

Asked whether the government would use new national security powers to try and force Arm to list in London, the spokesman said “I’m not aware of any plans to.”

Digital minister Chris Philp hinted last week that the government had made progress in its negotiations with SoftBank and the firm may be mulling a dual listing in New York and London.

The listing of the firm has been seen as totemic in the UK’s role to promote itself as  tech hub, due to both the strategic importance of chip manufacturing facilities and the potential size of the listing, which could fetch a valuation of around $50bn.