SoftBank is raising over $11 billion through a junk bond offering to fund a follow-on investment in OpenAI, according to Bloomberg. The deal comprises $10 billion in US dollar-denominated bonds and €1 billion in euro-denominated bonds.
Large technology investors are accessing debt markets to deploy capital into artificial intelligence ventures. Junk bonds, or high-yield debt, carry lower credit ratings and higher interest rates than investment-grade securities. SoftBank is using this instrument to fund an OpenAI stake.
SoftBank has been among the most aggressive institutional backers of AI infrastructure and applications. The Japanese conglomerate's Vision Fund has deployed tens of billions of dollars across chip makers, data center operators, and AI software companies since 2017. An OpenAI follow-on investment would mark another major commitment to the generative AI sector, though SoftBank has not disclosed the size of the intended stake or its terms.
The bond market for technology and AI-focused borrowers has remained open despite intermittent volatility in equity markets. Large institutional investors have continued to bid for high-yield debt from established operators seeking growth capital. SoftBank is tapping this market while deploying the proceeds into venture-stage or growth-stage bets.
OpenAI itself has raised multiple rounds of funding at ascending valuations, with investors including Microsoft, Thrive Capital, and sovereign wealth funds. SoftBank's participation in a follow-on round would expand the list of major institutional backers and potentially increase the company's valuation further, though no terms have been announced.
The $11 billion raise ranks among the largest junk bond issuances in recent years. A transaction of this size in speculative-grade securities indicates sustained investor appetite for high-yield debt from major conglomerates.
SoftBank's capital raise occurs as AI spending by technology giants and enterprise customers has accelerated. The company is deploying funds into OpenAI as demand for frontier AI models and services continues to grow. The document to watch is SoftBank's investor presentation for the bond offering, which will disclose the coupon rate and final size of the deal.
