Nvidia Corp. reportedly could invest in Arm Ltd.’s upcoming initial public offering, which is expected to be one of the largest-ever for a tech company.

The Financial Times reported the chip giant’s potential IPO participation today. Nvidia is said to be holding discussions about the matter with SoftBank Group Corp., which bought Arm for $32 million in 2016. Earlier reports suggest SoftBank is seeking to take the chip designer public at a valuation of up to $70 billion.

U.K.-based Arm sells processor blueprints that semiconductor companies use as the basis of their products. The company’s designs underpin billions of connected devices, as well as most of the world’s smartphones. Over the past few years, Arm-powered chips have also started finding use in servers.

In 2020, Nvidia offered to buy the company from SoftBank for about $40 billion. The graphics card maker planned to finance the transaction with a mix of cash and stock. While the deal awaited approval, Nvidia’s stock price rose significantly and pushed the acquisition price to $66 billion.

The acquisition fell through in 2022 after drawing significant antitrust scrutiny from regulators. In response, SoftBank decided to take Arm public. Arm is reportedly seeking to raise $8 billion to $10 billion in the IPO, which is expected to value it at between $30 billion and $70 billion. .

SoftBank has reportedly asked Nvidia to become an anchor investor in the stock listing. An anchor investor is an organization that buys a significant amount of shares in an IPO, which helps draw interest from additional backers. Such early stock purchases can also stabilize a newly listed company’s share price during its first days of trading.

Nvidia’s potential investment in Arm would reportedly be worth a few hundred million dollars. It’s believed the chipmaker is hoping to buy shares at a valuation of about $30 billion. SoftBank, in turn, is reportedly seeking to sell the stock at a valuation of around $80 billion.

Nvidia is not the only company that SoftBank hopes to onboard as an anchor investor. Last month, sources told Reuters that the company has approached more than 10 potential IPO backers. Intel Corp. is reportedly among those companies.

After speculation emerged last year that SoftBank could potentially sell Arm to an investor consortium, Intel publicly stated it would be interested in joining the group. More recently, it inked a technical partnership with the chip designer. The alliance focuses on enabling joint customers to manufacture Arm-based chips at Intel fabs.

Arm confidentially filed its IPO paperwork in March. The company is expected to list its shares as early as September.

Image: Arm