Current share price is only the price the last trade was made at. It would be remarkable if the other 90% could sell for anywhere near that number. Comparing an offer for the entire company to selling 10% to the public is a bit lopsided.
That is why they only sold 10%. They think they can keep market depth thin, raise the price, and sell more over time at higher prices when they need cash. This is exactly what Intel is doing with Mobileye. It’s a piggy bank that they will break open from time to time.
Generally if you want to buy the whole thing / take it private, you have to pay out all shareholders in cash the public market price plus a premium - you definitely don't get a discount.
Assuming there is a buyer waiting to take ARM private seems pretty unlikely.
If you happen to hold the majority of shares and then try to sell them suddenly you’ll sell them at a discount. Just look at TSLA when Elon had to liquidate significantly to pay for TWTR.
> Assuming there is a buyer waiting to take ARM private seems pretty unlikely.
The whole premise of this comment thread is that ARM made more by selling 10% of its stock on a public market than they would have by selling 100% of it to Nvidia. In other words: there already was a buyer who wanted to take ARM private. So how does it seem unreasonable to assume one would exist, when we already know that one did?
I don't know what that means - but when an individual or a company looks to buy out another company wholesale, they do in fact use the public market price, multiply it out by the full share cap, and then add a premium on top. That's literally how a buyout works.
That's literally not how buyouts work. The public stock price is certainly one factor of many that go into calculating the acquisition price, but it is not an absolute floor. One counter-example that comes to mind is Yahoo!, which was purchased by Verizon for less than its market cap at the time.
It’s not an absolute floor no, but it’s a strong factor in price determination. It feeds back the other way too, if a competitor is acquired for far less than public price it smacks the public price of competitors.
Think about it this way: The current market price represents the amount the shareholders who least value their shares would be willing to sell them for. As you want to acquire more, the price is going to go up, not down.
That's pretty irrelevant if it only represents 10% of the total equity, though. It's not like you, as a retail investor who owns a few shares of a company, have any say in whether it gets acquired.
whereas the $40B would have been for 100% of them