SoftBank Launches $11B Bond Sale Funding OpenAI
SoftBank Launches $11B Bond Sale Funding OpenAI
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Key Points
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The offering is expected to price on Sept. 24 and settle on Sept. 29, with Citigroup and JPMorgan serving as lead bookrunners; Goldman Sachs and Morgan Stanley are also helping run the books.
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SoftBank’s BB+ rating from S&P Global Ratings is the highest tier of speculative-grade debt, underscoring the unusually large size of the planned high-yield transaction.
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SoftBank could not be reached for comment when the offering was reported because the announcement came during a public holiday in Japan; the fundraising plans had previously been reported by Bloomberg, citing people familiar with the matter.
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The financing comes as borrowing costs are rising, highlighting SoftBank’s willingness to use high-yield debt to strengthen its competitive position in AI infrastructure and frontier-model companies while intensifying debate over debt-funded technology bets.
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SoftBank’s market capitalization was cited at approximately $254.15 billion, although GuruFocus said its GF Value data was unavailable, limiting its ability to assess the company’s intrinsic value.
SoftBank is raising $11 billion through bond sales to fund its massive bet on OpenAI. The Japanese tech company plans to sell $10 billion in dollar bonds and €1 billion in euro bonds, according to TipRanks. Most of the money will pay for a third investment tranche in OpenAI worth $10 billion, while the rest refinances an earlier bridge loan.
The deal ranks among the largest junk-bond offerings ever recorded. SoftBank's BB+ rating—the highest tier of risky debt—signals investor confidence in the company. Yet the move highlights growing concerns about SoftBank's leverage and its debt-funded push into AI infrastructure, Invezz reports.
SoftBank's Record Bet on OpenAI Reaches $65 Billion
SoftBank is doubling down on OpenAI with its third major investment tranche. The company's total commitment to the AI startup now approaches $65 billion, TradingView notes. This bond sale will finance $10 billion of that third round, making SoftBank one of OpenAI's largest backers alongside Microsoft and others.
Bond Terms Span Three and a Half to Seven Years
The dollar bonds mature in roughly 3.5 to 7.5 years, while euro notes mature in four to six years. Citigroup and JPMorgan lead the sale, with Goldman Sachs and Morgan Stanley also helping market the bonds. The offering is expected to price on September 24 and settle on September 29, TS2.Tech reports.
Rising Borrowing Costs Test SoftBank's AI Ambitions
SoftBank's willingness to raise debt at higher interest rates shows how serious the company is about competing in AI. Borrowing costs have climbed as the Federal Reserve holds rates steady. Yet this strategy also increases SoftBank's risk if AI investments fail to deliver expected returns, Invezz reports.
One of History's Biggest High-Yield Debt Deals
The $11 billion offering could be one of the largest junk-bond sales on record. SoftBank's market capitalization sits around $254 billion, making this a substantial capital raise for the company. The deal underscores both investor appetite for AI bets and debate over whether such debt-heavy financing makes sense, InShorts reports.
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