(Bloomberg) -- Arm Holdings Plc climbed 25% in its trading debut after raising $4.87 billion in the year’s biggest initial public offering, delivering a boost for both equity markets and SoftBank Group Corp. founder Masayoshi Son.Most Read from BloombergCaesars Entertainment Paid Millions to Hackers in AttackVideo-Game Company Unity Closes Offices Following Death ThreatWhen the Homeowners Association Comes for Your HomeRay Dalio Says He Doesn’t Want to Hold Bonds, Cash ‘Is Good’Russian Elite Bri
Shares of the chip designer, still 90% owned by SoftBank, closed at $63.59 in New York trading Thursday, giving Arm a market value of more than $65 billion. Including restricted share units, Arm’s fully diluted valuation closer to $68 billion.
Investors in the IPO included some of Arm’s biggest customers. The company set aside more than $700 million of its stock for Intel Corp., Apple Inc., Nvidia Corp., Samsung Electronics Co. and Taiwan Semiconductor Manufacturing Co. “This is just the beginning of the cycle and Arm is a great sign of what’s to come,” said Ross Gerber, co-founder and CEO of wealth management firm Gerber Kawasaki Inc. “The pricing is a big part of it, SoftBank was smart to price it where they did because they got a pop and drew investors in.”Son’s approach to IPO reflects his continuing long bet on Arm, whose chips are found in most of the world’s smartphones.
“The markets of last year didn’t really cooperate,” Arm’s CEO Rene Haas said in an interview. “In terms of where we landed the plane, relative to where we thought we were six to nine months ago, we, we landed in a great place.” Though Arm’s technology is used in almost every smartphone, it isn’t well-known among consumers. Arm sells the blueprints needed to design microprocessors, and licenses technology known as instruction sets that dictate how software programs communicate with those chips. The power efficiency of Arm’s technology helped make it ubiquitous on phones, where battery life is critical.
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