SoftBank Group Corp. has drawn more than $20 billion of preliminary demand for what’s shaping up to be one of the biggest junk bond deals ever, people familiar with the matter said, as investors rush to capture record yields likely to be offered to help fund the firm’s investments in OpenAI.
The potential interest reflects early, non-binding indications from investors and serves as an initial gauge ahead of pricing, which is still expected on Thursday, according to the people, who asked not to be identified discussing private matters.
SoftBank was seeking to raise the equivalent of more than $11 billion in the deal, including a $10 billion part and a €1 billion ($1.1 billion) euro portion, other people said Monday. There’s no cap for the size, and no final decisions have been made, they added.
“We launched $10 billion dollar and €1 billion” for the offering, a SoftBank representative said in an emailed reply to questions. “The deal is going very well with substantial demand. Anything else on deal size is pure speculation at this point, and we have no plans to upsize the deal.”
The AI bet
Billionaire Masayoshi Son’s conglomerate has committed close to $65 billion to ChatGPT creator OpenAI, making it one of the world’s biggest investors in artificial intelligence (AI) along with its other investments in the sector. That’s all, making SoftBank’s junk debt deal one of the biggest tests yet of investor sentiment toward AI at a time when its promises and risks are increasingly fueling volatility in global markets.
SoftBank and its lead banks had been sounding out investors on the potential pricing for the deal, other people familiar with the matter said Monday. The longest dollar tranche, a 7.5-year note, had been discussed for a potential yield as high as about 10%, with the longest euro part due in 6 years in the mid 8% area.
Those sounding-out levels, as well as the others across all the parts, would be record yields in those currencies at those tenors if priced at those levels. But details could change, and the deal hasn’t yet entered so-called initial price guidance, which generally comes closer to actual pricing and itself also isn’t necessarily where the final figures will necessarily land.
SoftBank held calls Monday for global investors and will continue with them Tuesday, the people said.
Citigroup Inc. is acting as the lead bookrunner and a joint global coordinator, alongside Goldman Sachs Group Inc., JPMorgan Chase & Co. and Morgan Stanley for the dollar tranche. JPMorgan is the lead bookrunner for the euro-denominated notes and among the joint global coordinators, together with Goldman Sachs and Deutsche Bank.
Citi, Goldman Sachs, JPMorgan and Deutsche Bank declined to comment, while Morgan Stanley didn’t immediately respond to a request for comment.
The latest deal adds to a flurry of recent activity by SoftBank, as it builds out its artificial intelligence financing capacity.
The conglomerate entered into a $40 billion bridge loan in March to fund an additional investment in OpenAI, and recently repaid the outstanding balance of $25.9 billion on that facility.
It closed out last week with nearly $21 billion in potential fresh borrowings. The group increased a margin loan backed by shares of its chip unit Arm Holdings Plc by $5 billion to $25 billion, people familiar with the matter said on Friday. And it recently secured an additional $450 million to an existing credit line, bringing the total to $6.5 billion.
Apollo Global Management Inc. is also in talks to boost the size of a loan to SoftBank by $3.6 billion to $9 billion to help it finance its investment in AI giant OpenAI. On top of that, the firm founded and led by billionaire Masayoshi Son secured an $11.87 billion loan, also to support its OpenAI investment, according to people familiar with those deals.
As part of its funding campaign this year, SoftBank has sold almost $15 billion of notes across currencies, making it the biggest junk-rated borrower in bond markets so far in 2026, Bloomberg-compiled data show. There was also a $10 billion loan earlier this year backed by its OpenAI stake.
The deals come amid a broader increase across markets in borrowing costs, as most major economies grapple with inflation. The yield on SoftBank’s dollar bond maturing in 2031 climbed to 8.2% earlier this month, up from as low as 6.7% in January, as spreads have widened and underlying Treasury yields have risen, Bloomberg-compiled data show.
Recent calls by the heads of some of the world’s biggest artificial intelligence platforms, including OpenAI, to slow AI advances due to safety concerns have introduced another layer of uncertainty. That recently contributed to an increase in the cost of insuring SoftBank’s debt against default to its highest level in three years.
OpenAI Chief Executive Officer Sam Altman’s remarks that the company won’t go public this year, a move that would increase the liquidity of SoftBank’s investments, have been closely watched by investors.
SoftBank is rated at BB by S&P Global Ratings and Fitch Ratings, its highest speculative-grade ratings. By contrast, Alphabet Inc. and Amazon.com Inc., the two biggest sellers of corporate bonds in 2026, have ratings of AA and AA, respectively, both higher than those of the Japanese sovereign.
Disclaimer: This article has been taken from Bloomberg with minor editing. It is for educational purposes only and does not constitute investment advice. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
