SoftBank is tapping global debt markets with $10 billion of dollar notes and €1 billion of euro notes as it prepares to fund another $10 billion payment into OpenAI, highlighting the scale of its AI investment strategy and the growing importance of debt financing

SoftBank Group has launched more than $11 billion of senior unsecured bonds to finance its expanding investment in OpenAI, marking another major step in the Japanese conglomerate's aggressive push into artificial intelligence.

According to a term sheet seen by Reuters, SoftBank is offering $10 billion of US dollar-denominated notes and €1 billion of euro-denominated notes. The proceeds will primarily fund SoftBank's $10 billion payment for the third tranche of its follow-on investment in OpenAI, which is expected to close on October 1. Part of the proceeds will also be used for general corporate purposes.

The size of the transaction underscores the enormous capital requirements associated with SoftBank's AI strategy. Bloomberg had reported that the transaction could rank among the largest junk-bond offerings by a single company, excluding distressed debt exchanges.

Multi-year bond structure

The dollar portion of the offering is divided across three maturities — 3.5 years, 5.5 years and 7.5 years — while the euro-denominated bonds carry four-year and six-year maturities.

The bonds are expected to be priced on September 24 and settle on September 29, according to the term sheet. The transaction will also replace a $10 billion bridge loan that SoftBank had previously arranged to finance its OpenAI investment.

The move effectively shifts part of SoftBank's funding structure from short-term bridge financing toward longer-dated capital-market debt, giving the company a more defined repayment schedule while continuing to fund its AI strategy.

SoftBank's growing OpenAI exposure

SoftBank's commitment to OpenAI has become one of the central components of its investment strategy. The company has committed close to $65 billion to OpenAI, making the AI company a major driver of SoftBank's capital allocation.

The scale of the investment means SoftBank's financial performance is increasingly linked to the valuation, funding requirements and eventual liquidity of its OpenAI stake.

The company has been using a combination of bonds, bank loans and asset-backed financing to meet its commitments. Bloomberg has reported several recent financing initiatives, including discussions with Apollo Global Management to increase a SoftBank loan to $9 billion from $5.4 billion.

Debt financing replaces earlier bridge funding

SoftBank's latest bond sale also illustrates its effort to refinance some of the borrowing initially arranged to support its OpenAI investment.

In March, the group entered into a $40 billion bridge loan related to an additional OpenAI investment. Reuters reported that the latest bond proceeds will replace a separate $10 billion bridge facility arranged for the investment.

SoftBank has therefore been progressively building a broader financing framework around its AI investments rather than relying exclusively on its balance sheet or asset sales.

The strategy provides access to large pools of institutional capital, but it also increases the importance of borrowing costs, asset valuations and future cash flows.

Borrowing costs become a key consideration

The timing of the bond sale is significant because SoftBank is raising money while its credit-risk indicators have come under greater market attention.

Higher US Treasury yields can increase the underlying cost of dollar borrowing, while wider credit spreads can make funding more expensive for a company with a high-yield credit profile.

SoftBank's ability to raise such a large amount of debt therefore provides an important market signal about investor appetite for financing its AI expansion. At the same time, the cost at which the bonds are ultimately priced will be closely watched by investors because it will indicate how much investors are demanding to take on SoftBank's credit risk.

Arm shares remain an important financing asset

Another major part of SoftBank's financing strategy involves its stake in Arm Holdings.

SoftBank has repeatedly expanded a margin-loan facility backed by Arm shares. Bloomberg has reported that the facility was increased to $25 billion this month, up from $20 billion previously.

As of May, the facility was secured by 769 million Arm shares, representing a substantial portion of SoftBank's ownership of the chip designer. SoftBank owns nearly 90 per cent of Arm, according to company filings cited in the report.

Using a listed asset such as Arm as collateral gives SoftBank access to substantial liquidity without immediately selling its strategic holding. However, the arrangement also exposes the group to the possibility that a significant decline in Arm's share price could affect its borrowing capacity or collateral requirements.

AI investment extends beyond OpenAI

SoftBank's capital requirements are not limited to OpenAI.

The group has been building a broader AI ecosystem covering semiconductors, robotics, data centres and digital infrastructure. It has acquired ABB's industrial robotics business for $5.4 billion and agreed to acquire data-centre-focused investment firm DigitalBridge Group for around $3 billion in cash, according to the information reported in the source material.

The group is also pursuing large-scale data-centre development through SB Energy. Its US operations are developing data-centre capacity across multiple locations, while SoftBank has announced plans for a major data-centre project in France.

Such projects require substantial upfront capital and could create additional financing needs even after the latest OpenAI-related bond sale.

OpenAI liquidity remains an important issue

SoftBank's growing exposure to OpenAI also makes the eventual liquidity of the investment an important consideration.

OpenAI Chief Executive Officer Sam Altman has said the company will not go public in 2026, meaning SoftBank cannot rely on a near-term public listing to create liquidity for its investment. Bloomberg reported that Altman expects an IPO no earlier than next year.

For SoftBank, a future OpenAI listing could provide a potential avenue to monetise part of its investment, although the timing and structure of any such transaction remain uncertain.

Until then, SoftBank has to balance its investment commitments against debt servicing, asset-backed borrowing and the value of its portfolio holdings.

The broader AI financing cycle

SoftBank's latest bond sale also reflects a much broader trend in global capital markets: investors and companies are committing increasingly large amounts of capital to AI infrastructure.

The expansion of AI models is driving demand for computing capacity, advanced chips, data centres, power infrastructure and networking equipment. Companies across the technology ecosystem are therefore seeking increasingly large pools of capital to fund expansion.

Reuters has highlighted the scale of the current AI infrastructure investment cycle, with major technology companies and investors committing billions of dollars to AI-related capacity and partnerships.

For SoftBank, the strategy is particularly capital-intensive because the group is simultaneously investing in AI companies and financing the infrastructure expected to support future AI growth.

What investors will watch

The immediate focus will be on the pricing of SoftBank's new bonds and the demand received from institutional investors.

A strong order book and relatively contained borrowing costs would provide evidence that debt investors remain comfortable financing SoftBank's AI strategy. Conversely, a high yield requirement could highlight concerns about leverage, asset concentration and the uncertainty surrounding the eventual monetisation of its OpenAI investment.

Investors will also continue to monitor Arm's share price, SoftBank's credit spreads, the size of its outstanding borrowings and any further financing commitments related to OpenAI or data-centre development.

The relationship between AI asset valuations and financing costs has become increasingly important. A strong valuation environment can support SoftBank's collateral base and investment portfolio, while a sharp correction in AI-related assets could make leveraged financing more challenging.

Market Outlook

SoftBank's latest bond sale puts the company's financing strategy firmly in focus as it expands its exposure to artificial intelligence. The transaction provides funding for the next $10 billion OpenAI payment while replacing a bridge facility with longer-dated capital-market debt.

For global investors, the key issue is no longer simply the size of SoftBank's AI investments, but how those investments are being financed. Bond yields, credit spreads, Arm's valuation and the eventual liquidity of SoftBank's OpenAI stake will remain important indicators of the group's financial risk profile.

The development also comes at a time when technology stocks and AI-related assets remain major drivers of global market sentiment. Reuters reported that Asian technology shares were stronger on Monday as investors continued to focus on AI-related demand, while global bond markets remained sensitive to changing interest-rate expectations.

SoftBank's bond sale therefore represents more than a single fundraising exercise. It is a significant test of investor appetite for debt-financed AI expansion and a closely watched indicator of how capital markets are pricing the risks and opportunities surrounding the next phase of the global AI investment cycle.