sure, but the market wouldn't value them at $40b, is the thing. At least not without a plan to turn that $2b into a lot more sometime into the future.

if you're uber, or google, deliberately running in the red to grow the business, sure, maybe you deserve a higher valuation than your revenue alone justifies. That's not where ARM is, there's huge headwinds to them attempting to monetize more heavily, even if they wanted to crank revenue it's hard to see how they get there without chasing away their customers.

an underlying problem here is that SoftBank really overpaid for ARM (and then proceeded to mismanage it into the ground) and they want their money back. And sure, that's not the market's problem, but as you can see from NVIDIA or Qualcomm making plays here, there's companies for whom the asset is really worth $40b.

If you artificially restrict what ARM is allowed to do - that mindset in this thread of "the purpose of ARM is to be a public utility providing IP at-cost for their customers to monetize" combined with "they shouldn't be allowed to sell to any customer that might see any synergies from a merger" - then no, it's definitely not worth $40b. Because you're not going to be able to grow that $2b and you don't have any synergies that enhance your own business. But that's the market valuation that the asset could generate in the right hards.

It's kind of unfortunate for SoftBank that they've sort of sleepwalked into a de-facto nationalization of their asset. The synthesis of all of this is that they aren't going to be allowed to sell it at a market price, they are going to be forced to either continue operating it with minimal margins, or sell it to a consortium at a massive discount to the true value of the asset, so that someone else can continue operating it with minimal margins. Even an IPO would result in a significantly constrained valuation as a result of the legal strictures that are being applied - the asset very obviously cannot be sold freely at a market price, and assets are only worth what someone is willing to pay (or in this case, can get the government to approve paying/who the government will approve paying). So even if IPO'd, it will have to operate in the same fashion. Effectively, there is no scenario in which ARM isn't going to be operated as a de-facto public utility going forward.

De-facto I don't see a difference between "the government takes your asset and pays you 1/4th of market rate" and "you need to sell your asset, but the government won't allow you to sell it to anyone except one specific buyer who is only willing to pay 1/4th of market rate". The fact that the asset ends up in the hands of (a trust owned by) Google/MS/Amazon rather than operated directly in the government books isn't relevant to the owner, in fact it actually kind of makes the whole thing more odious. Google/MS/Amazon are now leveraging government power to reduce their supplier costs.