SoftBank Group launched the sale of $10 billion and €1 billion (~$1.15 billion) senior notes to fund its $10 billion OpenAI third-tranche payment due around October 1, cancelling a prior bridge loan, a term sheet showed.
SoftBank Group Corp. has launched the sale of $10 billion and €1 billion (about $1.15 billion) of senior unsecured notes to fund its investment in OpenAI, according to a term sheet reviewed by Reuters on Monday. Combined, the package is about $11 billion at the exchange rate cited in the report.
The dollar notes are split into 3-1/2-year, 5-1/2-year, and 7-1/2-year maturities. The euro notes are split into 4-year and 6-year maturities. Proceeds will fund SoftBank’s $10 billion payment for the third tranche of its follow-on OpenAI investment, expected to close on October 1, plus general corporate purposes. SoftBank earlier secured a $10 billion bridge loan for the OpenAI investment; the bonds will cancel that facility, the term sheet said. Pricing is expected on September 24, with settlement on September 29.
If completed at the planned size, the offering would be the largest Asia Pacific and Japan non-financial corporate bond deal on record, surpassing 7-Eleven Inc.’s $10.93 billion sale in January 2021, LSEG data cited by Reuters showed. It would also rank among the 20 biggest corporate bond deals globally so far this year, per Dealogic data in the same report. SoftBank said it had no comment on the term sheet.
Fitch Ratings assigned the proposed notes a BB+ rating and said it expects SoftBank’s debt to rise as the company funds committed investments, while still retaining adequate liquidity and capital-markets access. Citigroup is lead bookrunner for the dollar notes and JPMorgan for the euro notes. Joint global coordinators include Citigroup, Goldman Sachs, JPMorgan, and Morgan Stanley on the dollar side, and JPMorgan, Deutsche Bank, and Goldman Sachs on the euro side.
The deal turns SoftBank’s next OpenAI check into one of the year’s landmark bond sales: a bridge loan replaced by public debt timed to an October 1 tranche close.