SoftBank Group is preparing a high-yield bond sale worth more than $11 billion, with part of the proceeds intended to fund an additional investment in OpenAI, the developer of ChatGPT. If completed, the transaction would rank among the largest high-yield bond offerings on record and underscore Masayoshi Son's strategy of using debt financing to expand the group's exposure to artificial intelligence assets.
$10 Billion Dollar Bond Offering Planned
Under the proposed structure, SoftBank plans to issue a total of $10 billion in dollar-denominated bonds across three maturities. It also plans to sell €1 billion, equivalent to about $1.1 billion, in euro-denominated bonds across two maturities.
The combined offering would exceed $11 billion. SoftBank has not yet disclosed the coupon rates or the amount to be issued in each maturity.
The transaction could be priced as soon as September 24, according to the current timetable. Completion remains subject to market conditions and investor demand, and the final terms may change before pricing.
Proceeds to Support Further OpenAI Investment
SoftBank plans to use part of the bond proceeds to support a follow-on investment in OpenAI. The investment is expected to be completed in October, although the amount has not been disclosed in the current transaction plans. OpenAI, the developer of ChatGPT, is one of the companies at the center of SoftBank's expanding artificial intelligence strategy.
For SoftBank, a high-yield bond sale provides funding for new investment commitments without relying entirely on asset sales or existing cash. It also adds interest and repayment obligations. The cost of the financing will depend on market interest rates, SoftBank's credit profile and investors' assessment of valuations across the artificial intelligence sector.
Cross-Market Structure Draws Bond Investors' Attention
The proposed offering spans both the dollar and euro bond markets and covers five maturities, making it considerably larger than a typical single-currency financing. If completed as planned, its size alone would make it one of the more closely watched large transactions in the high-yield market.
SoftBank Chairman and Chief Executive Officer Masayoshi Son has long pushed the group toward greater investment in artificial intelligence. The planned financing directly links the OpenAI investment to the debt markets: bond investors will need to assess whether future investment returns can cover SoftBank's financing costs, while the pace of the additional OpenAI investment will affect the group's use of funds and leverage management.
The information available so far indicates only that part of the bond proceeds will be used for the additional OpenAI investment expected next month. The remaining use of proceeds, bond ratings, coupon rates and final offering size are still subject to confirmation when the transaction is priced.