I saw this in a message from a company.

Problem:
The hyphen does not belong in this phrase.

Explanation:
The company in question was announcing that it had agreed to exchange some assets with another company.

The company stated in its announcement that the deal had not been approved by regulators.

So the company was emphasizing to readers that it would have to continue to operate as if the deal had never been made.

“At arm’s length” — with no hyphen — is the phrase that essentially describes a business/legal relationship in which the two parties make sure that they treat one another in the same way that they would treat other competitors.

While it is true that “arm’s length” must be hyphenated to form a compound modifier of a noun — as in “an arm’s-length transaction” — it makes no sense to insert a hyphen in the phrase “at arm’s length from”.

I believe that attorneys were involved in approving the aforementioned company’s announcement and that these attorneys included the hyphen between “arm’s” and “length” because they are very accustomed to using these two words to modify a noun.

Solution:
“… as a separate business at arm’s length from …”