UK-based chip designer Arm created a buzz in the semiconductor industry with plans to work with manufacturing partners to develop an advanced chip to demonstrate its technical capabilities, Financial Times (FT) reported.

The newspaper suggested the move to make its own chip is aimed at broadening Arm’s market, boosting profit and drawing in investors for a planned IPO in the US, estimated to generate at least $8 billion.

FT added Arm is only pursing a prototype, with no plans to sell or licence the chip, but the move raised concern the company could shift to manufacturing if the product is popular and then compete directly with customers.

Arm generally provides its designs to chipmakers, which then develop and produce the chips.

Richard Windsor, founder of research blog Radio Free Mobile, wrote Arm previously built chips for testing and development purposes, and suspects this is more of same.

Building and selling its own chips for device makers would put Arm into direct competition with its customers and destroy its independence, which was a key element in its success, he explained.

Windsor doubts the company intends to change its business model, noting the move “boils down to a dispute over how much Qualcomm will pay Arm for its IP”.

Arm and Qualcomm are involved legal battle in US court over IP licensing.

The SoftBank Group unit last month announced plans for a US-only listing this year, after previously considering a full or partial offering in the UK.