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The logo of the chip manufacturer Arm

Photo: Richard Drew / dpa

The U.S. IPO of chip designer Arm, whose technology is found in virtually all smartphones, brings the Japanese owner Softbank about five billion dollars. The issue price for the papers was set at $51, Arm said. It is thus at the upper end of the price range of 47 to 51 dollars. Trading in New York is scheduled to begin this Thursday.

The price range results in a valuation of more than $54 billion for Arm. According to information from the financial service Bloomberg, Softbank was originally aiming for a total valuation of $60 billion to $70 billion. Still, it will be the biggest IPO of the year so far in the U.S.

Softbank will retain a stake of around 90 percent in Arm after the IPO. Based on the chip architectures designed by Arm, Apple and Samsung, among others, develop the processors for their smartphones. The semiconductor company Qualcomm, whose chips run many Android phones, also uses it. The companies pay taxes to Arm for the use of the chip architectures.

The Arm designs prevailed over chip systems from Intel in smartphones and tablet computers – partly because they require less power. Meanwhile, chips based on Arm architectures are also used in data centers, and Apple uses them in its Mac computers.

Softbank had bought the British company Arm in 2016 for 32 billion dollars and taken it off the stock exchange. A sale to the chip company Nvidia failed last year due to concerns from competition watchdogs. After that, the IPO was decided, the proceeds of which will benefit Softbank.