SoftBank Group Corporation is planning a record $6.3 billion (¥1 trillion) retail bond sale next month — the biggest by any issuer in Japan — to raise funds for its investment commitments to OpenAI, according to a Bloomberg report.
The conglomerate, in an official release today, 24 August, said it expects the bonds to receive an A rating from Japan Credit Rating Agency. The Japanese firm’s shares fell 5.3% to 4,975 yen in Tokyo, as per the report
It cited the company's filing, adding that the seven-year bonds are expected to be priced on 4 September, with an indicative coupon range of 4.3-4.9%. Notably, this will be SoftBank’s third retail bond sale in 2026, following its ¥418 billion raise in April and ¥260 billion in June.
This move comes amid a global rush to gain leadership and amass funds in the hyper-competitive AI race, the report added.
A company spokesperson told Bloomberg that SoftBank plans to use proceeds from the issuance to refinance ¥400 billion of retail bonds maturing in September and to secure funding for its investments in artificial intelligence (AI).
The report added that SoftBank has committed over $60 billion to the ChatGPT-maker and has accelerated investments in data centres as it seeks to expand computing capacity. The spending comes as questions about how to monetise the technology persist alongside warnings about overcapacity, growing corporate debt and the circular nature of many AI fundraising deals, it added.
“The company is betting that retail investors will buy a product offering an attractive yield, and it appears confident it can tap demand at a time when there are few fixed-income products that can beat inflation,” Yuuki Fukumoto, senior financial researcher at NLI Research Institute, told Bloomberg.
Fukumoto added that banks are “finding it difficult to take on the risk given weak deposit growth, the credit rating and the seven-year duration, leaving the deal more reliant on retail investors”.
The new retail bond is likely to price toward the upper end of the indicated coupon range, according to Sharon Chen, a credit analyst at Bloomberg Intelligence. The company faces a shortfall exceeding $20 billion even after this bond issue, signalling a high likelihood of offshore bond issuance in the near term, she added.
S&P Global Ratings revised its outlook on SoftBank to stable from negative on 16 July, saying key financial ratios had improved more than previously expected. It affirmed SoftBank’s long-term issuer credit rating at BB, a notch below investment grade, the report said.
Notably, the four biggest AI players — Alphabet Inc., Amazon Inc., Meta Platforms and Microsoft Corporation — have pledged close to $2.4 trillion in combined AI-related expenditure over the coming years, the report said.
It added that China's Alibaba Group Holding raised the equivalent of $10 billion in Hong Kong’s biggest-ever secondary share sale on Monday, 24 August. The move will help fund its efforts to invest in chips, data centres and large-language models, it noted.
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