London dealt blow as Arm picks New York for stock market debut

London loses out as Arm chooses New York for stock market listing

Arm, a British company that makes microchips, says it won’t try to get listed on the London Stock Exchange this year.

The Cambridge-based company designs the technology that goes into processors, which are also called “chips” and are used to power everything from phones to game consoles.

Arm's snub to London: tech giant opts for New York listing
London loses out as Arm chooses New York for stock market listing

In January, it was said that Prime Minister Rishi Sunak had resumed talks with SoftBank, which owns Arm, about a possible listing in the UK.

Arm says it has decided that a single listing in the US in 2023 is the “best way to move forward.”

In a statement, CEO Rene Haas said, “After working with the British government and the [Financial Conduct Authority] for several months, SoftBank and Arm have decided that pursuing a US-only listing of Arm in 2023 is the best way forward for the company and its stakeholders.”

He also said that the company will think about going public in the UK “in due course.”

When a company is listed on a stock exchange, it goes from being a private company to a public company, where investors can buy and sell shares of the company’s stock.

This year, Arm didn’t go public on the London Stock Exchange. This has made people worry that the UK market isn’t doing enough to attract stock offerings from tech companies since US exchanges are thought to have higher valuations and profiles.

Masayoshi Son, the creator and CEO of SoftBank Group Corp., predicted last year that he would list Arm on the Nasdaq exchange, which is dominated by technology companies.

Arm was listed on both the London stock exchange and the Nasdaq for 18 years. In 2016, SoftBank bought Arm for $32 billion (£26.7 billion).

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Mr Haas said that Arm is hiring more people in the UK and opening a new site in Bristol. He also said that Arm would keep its important intellectual property, headquarters, and operations in the UK.

Arm continues to cooperate with the British government and is proud of its British heritage, the man said. “We will continue to be involved in and play a big part in the British tech ecosystem,” the report says.

“A spokesperson for the government said, “The UK is making big changes to the rules that govern its capital markets. This builds on our continued success as Europe’s leading investment hub and the second largest in the world.”

They also said that Arm is growing its business in the UK, creating new jobs and putting money into the economy.

‘Crown jewel’

Arm was started in 1990 in Cambridge, England. It is sometimes called the “crown jewel” of the UK’s tech industry.

Its chip design guidelines and methods are used to create processors by manufacturers like the Taiwan Semiconductor Manufacturing Company and businesses like Apple and Samsung.

According to the company’s most recent quarterly report, it has shipped more than 250 billion Arm-based chips and made 28% more money than it did during the same time last year.

SoftBank’s plans to sell Arm to graphics card maker Nvidia fell through last year when regulators in the UK, US, and Europe looked into whether the deal would raise chip prices and limit the number of options.

“Important blow”

Russ Shaw CBE, who started Tech London Advocates and Global Tech Advocates, said that Arm’s statement gave “glimmers of hope” that it would stay true to its British roots but that Arm and SoftBank’s decision to only list in the US is “a significant blow to the UK tech sector.”

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As for the London Stock Exchange, the past, present, and future of the UK semiconductor sector, Mr Shaw added that it is “disappointing news.”

He is one of the tech leaders in the UK who have asked the government to release its strategy for semiconductors to help British companies in the chip industry and supply chain.

After explaining that Arm’s sale to SoftBank in 2016 was the primary reason for the company’s decision to list only in the United States, he added, “must be maintained as a case study for the UK Government of how ‘not to do it.

“Countries like the US and China, which know the strategic value of chip companies, would not have let such decisions be made back then or now,” said Mr Shaw. “The UK must now try to protect its semiconductor industry in a proactive way.”

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