SoftBank Raises $3.3 Billion in Bonds Amid AI investment Reckoning
TOKYO – SoftBank โGroup Corp. this week secured $3.3 billionโฃ (500 billion yen) through a bond offering, โsignaling a shift in financing strategy as teh tech conglomerate โnavigates a cooling market โfor artificial intelligence investments and faces substantial upcoming payments. The seven-yearโข bonds,โฃ priced withโ a 3.98% coupon, were โขissued at the upper end of a previously announced 3.5% to 4.1% range -โ the highest coupon โขrate as 2009, โwhen โฃbonds were sold at โ4.52%.
A portion of the funds raised will be used โคto repay โa bridge loan tied to its notable investment in โคOpenAI. This move comes as โSoftBank aggressivelyโค liquidates assets to fund a portfolio of โAI-focused projects, including OpenAI itself, data centers developed with OpenAI โฃand Oracle, and various robotics factories in the United States. โฃThe companyโค led a $40โข 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 ($9.2โฃ billion) and โDoorDash ($7.9 billion).โ This sale โcoincided with Nvidia reaching all-time highs and becoming theโ world’s most valuable company, though Nvidia shares have since fallen over 15% amid increasing competition, especiallyโค fromโข Alphabet.
The โfinancial โขmaneuvering is driven by looming obligations: a $22.5 billion payment due in December for its OpenAI commitments and the $5.4โ billion acquisition of ABB’sโฃ robotics division. โ โSoftBank recently completed theโ $6.5 billion purchase of โฃAmerican chipโข design company Ampere Computing.
Meanwhile, โportfolio company Meesho, an Indian e-commerce firm backed by SoftBank,โ is โpreparing forโ an initial public offering inโ December, aiming โto raise approximately $600 million.
