SoftBank's arm IPO six times oversubscribed: Sources
chip designer owned by SoftBank Group Corp that is seeking roughly $5 billion in its stock market debut, has seen investor demand that is six times the amount it is asking for, people familiar with the matter said on Friday.
While the oversubscription does not guarantee a strong performance for Arm's blockbuster U.S. initial public offering (IPO), it makes it more likely that the company will at least reach its targeted price range of $47 to $51 per share, the sources said.
That price range values Arm at $50 billion to $54.5 billion on a fully diluted basis.
This would represent a climb-down from the $64 billion valuation at which SoftBank last month acquired the 25% stake it did not already own in the company from the $100 billion Vision Fund it manages.
It remains unclear whether Arm will attract enough investor demand to seek a higher valuation ahead of its IPO pricing on Sept. 13.
The sources said Arm will decide early next week whether to raise its IPO price range.
The sources requested anonymity because the matter is confidential. Arm declined to comment.
The Financial Times reported earlier on Friday that the IPO was oversubscribed.
Arm launched its marketing efforts this week for what is set to become the largest U.S. IPO in two years, seeking to convince investors it has growth ahead of it, beyond the mobile phone market, which it dominates with a 99% share.
Weak mobile demand during a global economic slowdown has caused Arm's revenue to stagnate.
