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On September 5th, according to documents filed as part of Arm’s initial public offering (IPO), Apple (AAPL.O) entered into a significant new agreement with Arm, extending their collaboration well beyond the year 2040.
Arm, in its bid to launch a colossal $52 billion IPO, revealed the pricing details on the same day. This IPO is poised to be the largest of its kind in the United States for the year. SoftBank Group (9984.T), the parent company of Arm, intends to offer a substantial 95.5 million American depository shares of Arm at a price range of $47 to $51 per share, as outlined in the filing.
Arm holds the intellectual property that underpins the computing architecture for the majority of the world’s smartphones. It licenses this technology to Apple and numerous other industry players. Apple, in particular, leverages Arm’s technology extensively in developing its bespoke chips for iPhones, iPads, and Macs.
The relationship between these two tech giants has a storied history. Apple was among the founding partners when Arm was established in 1990. Subsequently, in 1993, Apple introduced the “Newton” handheld computer, featuring an Arm-based processor chip. Although the Newton experienced limited success in the market, Arm’s energy-efficient chip designs paved the way for its dominance in mobile phone chipsets, significantly extending battery life in the devices it powered.
Furthermore, on the same day, Apple was part of a consortium of prominent technology companies that collectively invested a substantial $735 million in Arm’s IPO. It was reported by Reuters a week prior that Apple was among the strategic investors committing to purchasing shares.
It’s noteworthy that the specifics of this new agreement between Apple and Arm were not disclosed in Arm’s previous IPO filings, which were made public on August 21st. This suggests that the deal materialized between that date and September 5th.
Arm has chosen to remain tight-lipped on the matter, refraining from providing additional comments beyond its official filings. Apple, on the other hand, has not responded to immediate requests for comment, leaving room for speculation about the exact nature and scope of this extended partnership.
