I might be missing something, but I still don't get the why. I don't see any "problem" that needs to be solved.
The article lists the reasons quite clearly.
The reason is because arxiv is growing significantly leading to 297,000 deficit in operating costs for 2025 alone. Corenell has helped with donation a long with other organizations that pay membership fees.
As a result, donors + leaders of arxiv think it's best to spin off to increase funding.