Diamond Hands: SoftBank Isn't Leaving Arm Holdings, 'Keep As Much As Possible, As Long As Possible'

Zinger Key Points
  • Masayoshi Son cites industry importance and investor participation as the reason for the IPO.
  • "The world runs on Arm," says Arm CEO Haas; highlights company's widespread device integration.

Arm Holdings PLC ARM, the company behind the CPUs essential for Nvidia Corp.’s NVDA GPUs in artificial intelligence (AI) operations, debuted in the market Thursday.

The company recorded the largest IPO of 2023 with a valuation of $54.5 billion. The shares, initially priced at $51, within an IPO range of $47-$52, are currently trading near the $61 level.

The IPO is a significant event, not just for the industry but also for SoftBank Group Corp SFTBY, which acquired Arm Holdings in 2016 for $32 billion.

The Japanese conglomerate is retaining 90% of Arm Holdings and sold 10% of its position to investors.

Ninety percent is a lot — does SoftBank plan on selling any more of it? Probably not.

During a Thursday interview with CNBC, Masayoshi Son, founder of SoftBank, gave some insights regarding SoftBank's future stake in Arm Holdings.

The SoftBank founder said he wanted to “keep as much as possible, as long as possible,” noting his long-term belief in the company. He pointed out the primary reason for the IPO and the sale of shares was to offer investors a chance to benefit from Arm Holding's potential growth and to increase the company's transparency.

"Arm is such an important company for the industry. I wanted to give investors the opportunity to participate on the upside of Arm," Son said, adding "It used to be a public company. So [it's] back into a public company's position so that people will have more transparency of the operation of the companies and also give the engineers and employees stock options to realize."

Read Also: Betting Big: SoftBank Consolidates ARM Ownership Before Mega $54.5B IPO

Rene Haas, Arm Holding's CEO, commented on the firm's transition to a public entity and the associated responsibilities. Haas said one of his goals is to maintain a positive relationship with his primary shareholder — Son — and indicated alignment with the SoftBank founder regarding Arm's long-term vision.

Haas said, "The world runs on Arm. It's hard to find an end device that doesn't run on Arm." He also noted that more than 70% of the global population uses Arm-based devices. Expressing optimism about Arm's trajectory, Haas added, "I believe the best is ahead, and I'm excited about the next five to 10 years for the company."

ARM Price action: Shares of Arm Holdings were trading up 24.69% at $63.59 at market close Thursday, according to data from Benzinga Pro.

Read Next: SoftBank Retains 90% Of Arm After IPO: Haas, Son Discuss China Dynamics

Photo: Shutterstock

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