SoftBank seeks record $40 billion loan to fund OpenAI investment as AI bet intensifies

SoftBank pursues massive loan to bankroll OpenAI stake

SoftBank is seeking a loan of up to $40 billion to primarily fund OpenAI investment, according to people familiar with the matter, in what would be the Japanese conglomerate's largest-ever borrowing denominated solely in dollars1

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. The bridge loan would carry a tenor of approximately 12 months, with four lenders including JPMorgan Chase & Co. underwriting the facility1

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. Talks with banks remain ongoing and details could still change, though spokespeople for both JPMorgan and SoftBank declined to comment on the matter2

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Masayoshi Son doubles down on global AI boom

The potential size of the SoftBank $40 billion loan underscores founder Masayoshi Son's aggressive strategy to position his company as a linchpin in the global AI boom1

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. The $30 billion bet on the ChatGPT-maker comes on top of more than $30 billion the company has already injected into the tech giant, which now forms the centerpiece of Son's ambitions2

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. This gamble is reminiscent of his early investments in ByteDance Ltd. or Alibaba Group Holding Ltd., but at a far higher price1

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. SoftBank held about an 11% stake in OpenAI at the end of December, making the AI investment one of its biggest holdings alongside a roughly 90% stake in chip designer Arm Holdings Plc2

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Credit concerns mount as debt burden grows

The scale of SoftBank's bet has raised alarm among market observers, particularly given persistent concerns about an AI bubble and the lack of a truly mainstream use case for AI services1

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. This week, S&P lowered SoftBank's credit outlook, citing the danger that its investments in OpenAI may hurt SoftBank liquidity and the credit quality of its assets2

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. According to Bloomberg Intelligence analyst Sharon Chen, the $30 billion investment in OpenAI represents a further drag to SoftBank's credit profile, with the company facing limited headroom under S&P's 35% adjusted LTV threshold1

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. The company has been relying on debt and asset sales to fund more than $70 billion of AI investments since 2025, resulting in a large debt burden and weaker portfolio quality2

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Asset sales finance aggressive AI strategy

To bankroll its growing bet on OpenAI, SoftBank has unloaded assets including its stake in Nvidia Corp.1

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. The US company now represents one of SoftBank's biggest holdings, tethering the Japanese company's shares to ChatGPT's relative performance against Google's Gemini and Anthropic PBC's Claude2

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. The company has already increased the amount of its margin loans secured by mobile unit SoftBank Corp. and chip unit Arm1

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. Bloomberg Intelligence notes that SoftBank benefits from strong access to the yen market and can raise more than $10 billion from the sale of T-Mobile and listed tech stocks, excluding Arm2

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Broader AI investments compound financing needs

Beyond OpenAI, SoftBank has shelled out on smaller bets across the AI ecosystem. SoftBank and OpenAI have jointly invested $1 billion in SB Energy, an infrastructure company working with tech firms on a US buildout of data centers1

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. The company has also agreed to buy private equity firm DigitalBridge Group Inc. for about $3 billion in cash2

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. Last year, it bought US chip designer Ampere Computing LLC for $6.5 billion and proposed a $5.4 billion acquisition of ABB Ltd.'s robotics unit1

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. All these investments underscore the need for the tech investor to take on large sums of debt from lenders2

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OpenAI IPO could provide crucial exit path

OpenAI is laying the groundwork for an IPO that could value the company at up to $1 trillion, Reuters exclusively reported last year. Last month, the firm said it would raise $110 billion in a funding round that could value it at $840 billion, including $30 billion each from SoftBank and US chipmaker Nvidia, and $50 billion from e-commerce retailer Amazon. Bloomberg Intelligence identifies the timing of an OpenAI listing as a key positive catalyst for SoftBank, though an uncertain macro backdrop and concerns around an AI bubble pose risk to the company's loan-to-value ratio2

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. Market observers will be watching closely to see whether SoftBank's bonds remain volatile, with supply risk and potential risk-off posing spread widening pressure1

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