SoftBank’s $11B junk bond sale draws $20B in demand

SoftBank Group Corp. has kicked off one of the largest corporate high-yield bond sales ever, seeking to raise more than $11 billion to fund the Japanese conglomerate's expanding bet on artificial intelligence and its deepening financial ties to OpenAI.

A Record-Setting Deal

The offering, which began marketing earlier this week, includes $10 billion in dollar-denominated notes split across 3.5-year, 5.5-year, and 7.5-year maturities, alongside €1 billion in euro-denominated bonds in four-year and six-year tranches, according to a term sheet reported by Reuters. The bonds are expected to price on Thursday and settle on September 29. Fitch Ratings assigned the proposed notes a BB+ rating.reuters+1

By Tuesday, the deal had already drawn more than $20 billion in preliminary, non-binding investor interest, according to Bloomberg. "The deal is going very well with substantial demand," a SoftBank representative said, while adding that talk of upsizing was "pure speculation" and that the company had no plans to increase the offering.bloomberg+1

If completed at its planned size, the sale would rank as the largest Asia-Pacific and Japan nonfinancial corporate bond deal on record, surpassing Seven & i Holdings' $10.93 billion offering in 2021, according to LSEG data cited by Reuters.channelinsider+1

Funding the OpenAI Wager

Proceeds will go toward the third tranche of SoftBank's follow-on investment in OpenAI, expected to close on October 1, as well as general corporate purposes. The bond sale will also allow SoftBank to cancel all or part of the undrawn capacity on a separate bridge loan facility arranged earlier this year.reuters+1

Billionaire Masayoshi Son's firm has committed close to $65 billion to OpenAI, making it the largest outside backer of the ChatGPT creator. SoftBank has already sold almost $15 billion of notes across currencies in 2026, making it the biggest junk-rated borrower in bond markets this year. Additional borrowing has included a $25 billion margin loan backed by shares in Arm Holdings ↗ 3.19% and an expanded $6.5 billion credit facility.channelinsider+3

Growing Unease Over AI Debt

The offering arrives as global AI-related debt issuance has topped $575 billion in 2026, according to Goldman Sachs The Goldman Sachs Group, Inc. ↘ 1.03% credit strategists. The longest dollar tranche in SoftBank's deal was discussed at a potential yield as high as about 10 percent, which would be a record for that tenor if priced at that level.finance.yahoo+1

Some bond investors have grown uneasy about the mounting pile of AI-linked debt. SoftBank's cost to insure its debt against default hit a three-year high this month as concerns about an AI slowdown intensified. The company carries an S&P rating of BB+, the highest speculative grade — well below the AA+ and AA ratings held by Alphabet ↘ 0.99% and Amazon Amazon.com, Inc. ↘ 1.34%, the two largest corporate bond issuers of 2026.finance.yahoo+1