SoftBank to court investors for up to $20B junk bond sale

SoftBank Group is preparing to meet with investors in New York next week to test appetite for what could be one of the largest junk-bond offerings in history, as the Japanese conglomerate scrambles to refinance a massive loan backing its bet on artificial intelligence.

Chief Financial Officer Yoshimitsu Goto and other executives will hold in-person discussions from Sept. 14 to Sept. 17 at Citigroup's ↗ 0.75% offices, Bloomberg first reported on Tuesday. The meetings, arranged by Citigroup, Goldman Sachs ↗ 0.93%, JPMorgan Chase ↗ 0.54%, and Morgan Stanley ↗ 0.56%, are intended to gauge interest and are not tied to a specific offering. Investors eligible to purchase notes sold in the U.S. under Rule 144A will attend.bloomberg+1

A Borrowing Spree to Back AI

SoftBank is considering raising $10 billion to $20 billion through the junk-bond sale, which may also include a euro-denominated tranche, according to people familiar with the matter cited by Bloomberg last month. The proceeds would help repay a $40 billion unsecured bridge loan the company secured in March to fund a $30 billion follow-on investment in OpenAI. That bridge facility, arranged by JPMorgan, Goldman Sachs, Mizuho, and others, matures in March 2027.cryptobriefing+4

SoftBank's cumulative investment in OpenAI is expected to reach roughly $64.6 billion upon completion of the follow-on tranches, giving it approximately 13% ownership. The company completed a $10 billion second tranche on July 1 and plans a third $10 billion installment on Oct. 1.group+1

Spreading the Debt Load

The potential dollar-denominated offering follows SoftBank pricing Japan's single largest corporate bond on Sept. 4 — a ¥1 trillion ($6.5 billion) seven-year retail bond with an indicative coupon range of 4.3% to 4.9%. Together, the domestic and international debt raises illustrate SoftBank's strategy of spreading its borrowing across multiple markets and maturities to replace short-term bridge financing with longer-term obligations.japantimes+2

The company's aggressive leverage has drawn scrutiny from investors concerned about concentration risk in AI-related assets. SoftBank's financial strength has been rated as low by some analysts, even as its growth and momentum metrics remain elevated.gurufocus

What Comes Next

The New York meetings will set the stage for a potential sale that, at the upper end of the range, would rank among the largest high-yield bond offerings on record. Whether SoftBank proceeds — and at what size — will depend on investor demand and market conditions in the weeks ahead.