SoftBank Raises $3.3 Billion in Bonds Amid AI investment Reckoning
TOKYO – SoftBank Group Corp. this week secured $3.3 billion (500 billion yen) through a bond offering, signaling a shift in financing strategy as teh tech conglomerate navigates a cooling market for artificial intelligence investments and faces substantial upcoming payments. The seven-year bonds, priced with a 3.98% coupon, were issued at the upper end of a previously announced 3.5% to 4.1% range - the highest coupon rate as 2009, when bonds were sold at 4.52%.
A portion of the funds raised will be used to repay a bridge loan tied to its notable investment in OpenAI. This move comes as SoftBank aggressively liquidates assets to fund a portfolio of AI-focused projects, including OpenAI itself, data centers developed with OpenAI and Oracle, and various robotics factories in the United States. The company led a $40 billion financing round for OpenAI last spring.
SoftBank has been actively cashing out of successful investments, most notably selling 32.1 million shares of Nvidia for $5.83 billion – its third-largest divestment after Uber ($9.2 billion) and DoorDash ($7.9 billion). This sale coincided with Nvidia reaching all-time highs and becoming the world’s most valuable company, though Nvidia shares have since fallen over 15% amid increasing competition, especially from Alphabet.
The financial maneuvering is driven by looming obligations: a $22.5 billion payment due in December for its OpenAI commitments and the $5.4 billion acquisition of ABB’s robotics division. SoftBank recently completed the $6.5 billion purchase of American chip design company Ampere Computing.
Meanwhile, portfolio company Meesho, an Indian e-commerce firm backed by SoftBank, is preparing for an initial public offering in December, aiming to raise approximately $600 million.
