Investing.com -- Shares in Intel rose (NASDAQ:INTC) on Tuesday, buoyed by a report that the chipmaker is in talks to be an anchor investor in the initial public offering of SoftBank Group Corp's (TYO:9984) Arm unit.
SoftBank also jumped over 6% to a four-month high of ¥6,364.0 ($1 = ¥139.53), and was among the best performers on the Nikkei 225 index, which rose nearly 2%.
Multiple reports suggested that Intel is in negotiations with U.K. chip designer Arm to be an anchor investor in the firm’s planned Nasdaq listing. Arm intends to raise between $8 billion and $10 billion, according to media reports from earlier in the year.
Arm’s designs are used by most major global chipmakers, including Intel, Advanced Micro Devices, Inc. (NASDAQ:AMD), Nvidia (NASDAQ:NVDA), and Qualcomm (NASDAQ:QCOM), making the business a vital member of the semiconductor industry.
Arm is also a key component of SoftBank’s portfolio, being among the few profitable investments held by the Japanese investor after a rout in technology stocks battered it over the past year.
SoftBank is counting on the cash injection from the Arm flotation to prop up its other ventures after a steep drop in its technology holdings led to two consecutive years of losses.
Arm saw strong sales over the prior year, helping negate some of Softbank’s overall losses, as the chipmaking sector remained robust.
SoftBank has delayed the Arm IPO several times over the past year, but filed a confidential listing with U.S. regulators earlier in 2023.
Arm going public could also come as a shot in the arm for U.S. IPOs, which have slowed down in frequency and value so far this year due to pressure from rising interest rates and high inflation.
Semiconductor demand is forecast to expand rapidly this year thanks to a surge in interest in artificial intelligence development, which could serve to make Arm an even more profitable venture for SoftBank.