SoftBank secures $10B loan backed by its OpenAI stake

SoftBank Group has secured a $10 billion margin loan backed by its equity stake in OpenAI, the Japanese conglomerate disclosed in its latest financial report, capping months of difficult negotiations that had at one point stalled entirely.

The Deal

The two-year facility was signed Wednesday with a consortium of lenders including Goldman Sachs The Goldman Sachs Group, Inc. ↘ 1.38%, JPMorgan Chase ↘ 0.73%, Mizuho Securities, Apollo Global ↗ 0.17%, and Sumitomo Mitsui Banking Corp. ↘ 1.11%, according to Bloomberg. SoftBank plans to draw down the loan this month, with proceeds earmarked for general corporate purposes and investments through its Vision Fund II-2.finance.yahoo+2

The company is serving as guarantor for the borrowing — a concession SoftBank offered to make lenders more comfortable after earlier attempts foundered over concerns about valuing a private company's shares as collateral. The loan includes provisions requiring early repayment or cash posting if OpenAI's preferred shares decline substantially in value.eurasiabusinessnews+2

A Long Road to Closing

The loan's path to completion was anything but smooth. SoftBank first sought the $10 billion facility in April, but by May had cut its target to $6 billion amid lender hesitation. By early June, even those reduced talks had stalled, with Bloomberg reporting that discussions hit an impasse over the difficulty of valuing privately held equity. SoftBank reopened negotiations in July, this time offering a corporate guarantee to give banks recourse beyond the OpenAI collateral itself.americanbazaaronline+3

Deepening the AI Bet

The margin loan adds to SoftBank's already substantial leverage. It follows a $40 billion bridge loan the company secured for its OpenAI investments, which attracted 21 new lenders during syndication last month. SoftBank's total planned investment in OpenAI is expected to reach approximately $65 billion by October, representing roughly a 13% ownership stake in the AI company.newsbytesapp+2

The funding strategy reflects founder Masayoshi Son's conviction that OpenAI represents a generational technology opportunity, but it also concentrates financial risk around a single highly valued private asset with no public market for its shares. Investors will be watching whether OpenAI moves toward a public offering that could provide SoftBank a path to monetizing — or at least more transparently valuing — its enormous position.eurasiabusinessnews