Nvidia shares lead after Arm talks report on US IPO

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Key points to remember

  • Nvidia is said to be in talks with Britain’s Arm about an IPO in the United States.
  • The chipmaker attempted to buy Arm outright, but was thwarted by regulators.
  • Nvidia shares traded near their all-time high last month following the news.

Shares of Nvidia (NVDA) rose more than 2% in early trading on Wednesday after a report said the chipmaker was renewing talks with UK-based chip designer Arm, with a view to… a possible initial public offering (IPO).

Nvidia shares hovered near their all-time high after the FinancialTimes reported that Nvidia could be an anchor investor in the British company’s U.S. IPO plan. Nvidia would be one of many partners that will also include rival Intel (INTC). The British company hopes that these partners will take a long-term stake at the IPO stage.

Nvidia tried to buy Arm in 2020 from its owner, Japanese group SoftBank, for $66 billion, but abandoned the effort last year after regulators challenged the deal.

The report notes that potential investors are still negotiating with Arm over its valuation. Nvidia is apparently aiming for between $35 billion and $40 billion, while Arm is eyeing $80 billion.

Arm might be particularly interested in Nvidia because of the company’s reach into artificial intelligence (AI), which is central to Arm’s growth plans.

With Wednesday’s gains, Nvidia shares have almost tripled in value this year so far.

Y-Charts


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