Arm, Listed in the US Not the UK? ... Even Boris Johnson Steps in to 'Hold On'

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Following the collapse of the acquisition of the U.S. semiconductor company Nvidia, the UK semiconductor design firm Arm is pursuing an initial public offering (IPO), and the UK government has begun persuading Arm's major shareholder, Japan's SoftBank. As SoftBank has shown interest in listing on the New York Nasdaq, UK Prime Minister Boris Johnson is also making efforts to attract the company to the London Stock Exchange.

On the 2nd (local time), a major UK foreign media outlet reported, citing sources, that UK government officials are in contact with SoftBank and are working on persuasion. Multiple sources said that as part of these efforts, Prime Minister Johnson recently sent a letter to SoftBank's management.

The UK government's efforts to bring Arm's listing to the London Stock Exchange are being led by Chris Philp, Minister for Digital, and Gary Grimstone, Minister for Investment at the Department for International Trade and former Barclays chairman. They plan to meet with SoftBank's management within weeks for discussions. Foreign media reported that the UK government's lobbying activities involve several departments, including Digital, Culture, Media, Treasury, and Business.

Previously, Arm had pursued a merger with Nvidia since September 2020 but faced regulatory hurdles from major countries worldwide, including the U.S., ultimately failing the merger in February. Subsequently, in the same month, Arm announced it would proceed with an IPO instead of the merger, and SoftBank Chairman Masayoshi Son stated that the New York Nasdaq exchange is the global center of high-tech and an appropriate place for Arm's listing.

The UK government views that if Arm proceeds with its IPO in New York rather than London, it would deal a blow to the country's efforts to strengthen its technology sector. A source said, "The UK government is trying to foster specific technology sectors," adding, "Arm is a company in a very significant field and is politically sensitive."

However, despite the UK government's efforts, SoftBank is expected to push forward with Arm's listing on the New York Stock Exchange. Sources familiar with SoftBank's stance said that most small investors consider an IPO in New York more appropriate than in London, and that SoftBank is unlikely to change its mind.