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SoftBank Launches $10B+ Junk Bonds for OpenAI Investment
- •SoftBank Group Corp has issued over $10 billion in junk bonds to finance its investment in OpenAI.
- •The bonds include dollar-denominated notes across 3-1/2, 5-1/2, and 7-1/2-year tenors, and euro-denominated bonds for 4 and 6 years.
- •Proceeds will fund SoftBank's $10 billion payment for the third tranche of its OpenAI investment, expected to close October 1.
- •The bond issuance will also cancel a previously secured $10 billion bridge loan facility for the OpenAI investment.
- •Citigroup and JPMorgan are leading the bookrunning for these notes, which are expected to price on September 24.
Key Questions Answered
SoftBank Group has launched $10 billion and 1 billion euro-denominated senior unsecured notes to fund its investment in OpenAI. The dollar-denominated notes feature 3-1/2-year, 5-1/2-year, and 7-1/2-year tenors, while the euro bonds are split into 4-year and 6-year tenors.
The proceeds will 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, as well as for general corporate purposes. Additionally, these bonds will cancel an earlier $10 billion bridge loan facility secured for the OpenAI investment.
According to the term sheet, the bond issuances are expected to price on September 24 and settle on September 29. Citigroup and JPMorgan are serving as the lead bookrunners for the notes.
