SoftBank’s Arm rebuffs London by choosing US listing over UK

British chip technology firm Arm Ltd, owned by Japan’s SoftBank (9984.T), said on Friday it would pursue a US-only listing this year, dashing the hopes of the British government that the tech giant would return to the London stock market.

Still, the company did not completely rule out an eventual London listing, saying it intended to consider a subsequent IPO there in due course, without providing further details.

Arm designs the processor technology used in nearly every smartphone, selling intellectual property to companies such as Apple Inc (AAPL.O) and Qualcomm Inc (QCOM.O).

“After engagement with the British Government and the Financial Conduct Authority over several months, SoftBank and Arm have determined that pursuing a US-only listing of Arm in 2023 is the best path forward for the company and its stakeholders,” Arm Chief Executive Officer Rene Haas said in a statement.

The decision is a blow to London, where Arm was listed until it was bought by SoftBank in 2016 in a $32 billion deal that received the minimum level of scrutiny by the government, leading to criticism that it had allowed Britain’s biggest tech success to be bought by foreign investors.

A British government spokesperson said: “The UK is taking forward ambitious reforms to the rules governing its capital markets, building on our continued success as Europe’s leading hub for investment, and the second largest globally.

“We continue to attract some of the most innovative and largest companies in the world – and note Arm’s commitment to expanding its presence in the UK, providing a boost to growth, jobs and investment.”

Arm, which was founded and is based in Cambridge, east England, said it would open a new site in the English city of Bristol, with plans to maintain its headquarters, operations and material IP in Britain.