SoftBank plans first euro bond as AI funding grows

SoftBank Corp. is preparing its first euro bond sale with investor calls in Asia and Europe starting April 8 for benchmark-sized fixed-rate senior unsecured euro-denominated notes with long six- and 10-year maturities.

Major banks such as JP Morgan and Citigroup are arranging the calls, and the offering is expected to be rated BBB by S&P and BBB+ by Fitch if market conditions allow.

The planned sale comes as SoftBank Group Corp. explores raising as much as US$40 billion in loans largely to fund its OpenAI investment.

🔗 Source: Bloomberg

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Implications, context, and why it matters.

The parent company’s AI spending looms over the subsidiary’s bond sale

SoftBank Corp. is raising money in steadier debt markets, while SoftBank Group Corp. has put more than US$34 billion into OpenAI and is reportedly discussing another US$30 billion commitment 1.
That focus on one private company has reportedly pushed SoftBank Group to sell liquid holdings, including Nvidia, the AI chipmaker, and T-Mobile, the US wireless carrier, to bring in cash 1.
SoftBank Corp. also ties into the plan. It has been named the first user of “Crystal intelligence,” an enterprise AI product from a new SoftBank Group and OpenAI joint venture in Japan 2.

SoftBank Group’s AI drive raises concentration and cross-holdings risks

SoftBank Group is reportedly trying to build an end-to-end AI stack that links its OpenAI stake with a hardware unit that includes Arm, the chip design company, plus chip startups Ampere and Graphcore 1.
Those links can muddy valuations. A report citing Jefferies, the investment bank, says SoftBank Group pays about US$3 billion a year to OpenAI for services in Japan, while roughly US$200 million in payments to Arm Holdings make up about 16% of Arm’s quarterly revenue 3.
The tighter the exposure, the more SoftBank Group’s performance and market mood can swing with OpenAI’s private valuation and funding needs, according to one report 1.