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Intel Is Reportedly Eyeing a Major Role in ARM IPO Later This Year

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Intel ARM

Intel's bonhomie with the chip designer ARM appears to be on the rise, judging by the latter's evolving public flotation plans and the former's readiness to bolster this effort.

To wit, Reuters is now reporting that Intel is eyeing the role of the anchor investor in ARM's upcoming IPO. ARM is expected to raise anywhere between $8 billion and $10 billion by publicly listing its shares later this year.

As a refresher, ARM is currently owned by Japan's SoftBank Group. The UK-based firm designs silicon chips and licenses instruction sets that govern how chips communicate. Moreover, ARM's intellectual property – including the company's Reduced Instruction Set Computing (RISC) Instruction Set Architecture (ISA) – is utilized by the likes of Apple, Qualcomm, Samsung, and Huawei for their smartphone chips, thereby corresponding to a market coverage of around 90 percent.

Of course, ARM was forced to implement mass layoffs and budget cuts back in 2022 when its planned acquisition by NVIDIA fell through amid vociferous opposition from a number of anti-monopoly watchdogs, including the UK's CMA and the United States' FTC. For its part, NVIDIA was forced to take a $1.25 billion hit in the form of a breakup fee.

In recent weeks, Intel has accelerated its cooperation with ARM on numerous fronts. The two companies recently signed a multi-generational agreement to manufacture next-gen mobile SoCs on Intel's 18A process node. Under the deal, ARM can leverage Intel's "open system foundry model" to customize diverse areas such as chipsets, packaging, and software. Do note that Intel has, up till now, predominantly delved into the manufacturing of x86 chips.

Against this backdrop, it remains unclear as yet how Intel's prominent role in ARM's IPO would shape their mutual relationship. In any case, as an anchor investor, Intel is likely to acquire a significant stake in ARM, giving it quite a lot of sway over the chip designer's future plans.

Written by Rohail Saleem

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