Markets

Intel Looking to Become Anchor Investor in SoftBank’s Arm IPO

 

US chipmaking giant Intel is in talks with SoftBank Group’s Arm to be an anchor investor in the chip designer’s initial public offering (IPO), a source familiar with the matter said on Monday.

SoftBank’s Tokyo-listed shares jumped 5% on Tuesday following the news.

Arm filed with regulators in April for a US stock market listing later this year. The chip designer is looking to raise $8-10 billion on Nasdaq, setting the stage for this year’s largest IPO.

 

Also on AF: Nikkei Soars on Chip Firms Boost Bets, Tech Lifts Hang Seng

 

Arm’s designs are used to manufacture chips made by most of the world’s major semiconductor companies, including Intel, AMD, Nvidia and Qualcomm.

It was not immediately clear what impact any IPO investment by one or more of those companies would have on Arm’s commercial relationships.

 

Fresh layoffs at Vision Fund

Meanwhile, two people familiar with the matter said SoftBank was planning a fresh round of layoffs at its Vision Fund investment arm.

The layoffs, which could be announced in the next two weeks, may impact up to 30% of its staff at the unit, including employees in US, one of the people added. SoftBank’s Vision Fund unit, which has booked heavy investment losses, had headcount of 349 at the end of March, according to a company report.

If finalized, the latest cost-cutting move at the Japanese conglomerate would follow the elimination of about 150 jobs globally at the investing arm and SoftBank Group International in September.

An aggressive investor in tech companies such as fintech giant Klarna and TikTok owner ByteDance, SoftBank has seen the valuation of its portfolio drop amid sharp interest rate hikes and rising US-China tensions.

The group reported an annual net loss of 970 billion yen ($7.2 billion) for the year ended March 31. It cushioned the investment loss at the Vision Fund unit by selling down its stake in China’s Alibaba.

Vision Fund 2’s portfolio was worth $31 billion at end-March compared with an acquisition cost of $49.9 billion.

SoftBank has radically scaled back its investing activity. Its founder Masayoshi Son has also withdrawn from public presentations to focus on the listing of Arm.

 

  • Reuters, with additional editing by Vishakha Saxena

 

Also read:

 

AI Chip Gold Rush Pumps Up SoftBank Shares Ahead of Arm IPO

 

SoftBank Shares Soar as Arm Rolls Out New Smartphone Chip Tech

 

S&P Cuts SoftBank Rating Deeper Into Junk Over Alibaba Sale

 

SoftBank to List Arm in New York, Despite British Appeals

 

SoftBank’s Arm Cannot Sell Cutting-Edge Chip Designs to China

 

Vishakha Saxena

Vishakha Saxena is the Multimedia and Social Media Editor at Asia Financial. She has worked as a digital journalist since 2013, and is an experienced writer and multimedia producer. As a trader and investor, she is keenly interested in new economy, emerging markets and the intersections of finance and society. You can write to her at vishakha.saxena@asiafinancial.com

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