Japanese conglomerate SoftBank (SFTBY) is looking to secure anchor investors for UK chip designer Arm ahead of its much-anticipated Nasdaq IPO. Initially, SoftBank had eyes for Nvidia (NVDA), Intel (INTC), and a few others, but insiders suggest the list has expanded. Now, heavyweights like Google (GOOGL), Apple (AAPL), and Amazon (AMZN) are under the spotlight. With Amazon being a big-league player in cloud computing and having Arm designs at the heart of its self-made data center chips, an investment from their end would be more than just money; it’d be a massive vote of confidence for Arm.
Yet, price tags and valuations have become the crux of the conversation. While SoftBank dreams of a $60 billion market valuation for Arm, a person familiar with discussions suggests that Nvidia pitched a more modest figure between $35 to $40 billion. Arm, on the other hand, Arm is eyeing a lofty valuation of nearly $80 billion. Overall, Arm is aiming to raise $8 to $10 billion from its planned IPO.
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Turning to Wall Street, both AMZN and NVDA stocks are rated as Strong Buys by analysts with price targets that imply upside potentials of over 23% and 17%, respectively.