The competition to become a cornerstone investor in Arm Holdings, the chip designer, is hotting up and it may explain why its current owner, the tech investor SoftBank, was keen to list the British business in the US.
According to an overnight exclusive from the Reuters news agency, Amazon.com Inc is in discussions to become a major Arm backer ahead of its highly-anticipated initial public offering (IPO).
This move highlights Arm's pivotal role in the cloud computing sector, given that Amazon Web Services, Amazon's cloud division, utilises the Cambridge-based group's design for its Graviton processing chip.
Arm, aiming for a Nasdaq quote in early September, hopes to raise between $8 billion and $10 billion.
While both Arm and Amazon refrained from commenting on the Reuters story, sources told the outlet that Arm had approached around 10 tech giants, including Intel, Alphabet Inc (NASDAQ:GOOG) and Nvidia Corporation, for pre-IPO investments.
These cornerstone investors, however, won't secure any board seats or control, the exclusive revealed.
The strategy aims to fortify Arm's relationships with leading clients and enhance the IPO's allure.
The listing is anticipated to provide a significant boost to SoftBank, which is striving to rejuvenate its Vision Fund after several tech investments faltered.
SoftBank has been eyeing an Arm listing since its proposed $40 billion sale to Nvidia was thwarted by antitrust concerns.
Recently, Arm's performance has outshone the broader chip sector, emphasising data centre servers and PCs that yield higher royalties.