SoftBank Tests Investor Appetite with $10-20 Billion Junk Bond Sale
SoftBank is set to test investors' appetite for AI-linked debt with its plans to issue junk bonds worth between $10 billion and $20 billion. The bond sale, which could be one of the largest high-yield deals in recent memory, aims to refinance a $40 billion bridge loan that funded SoftBank's commitments to OpenAI.
The Japanese conglomerate has scheduled investor meetings in New York from September 14-17 to gauge demand for the potential junk-bond sale. The bond will be issued to support SoftBank's investments in OpenAI, with the company holding a BB+ credit rating from S&P, one notch below investment grade.
The refinancing effort is necessary because the bridge loan matures in March 2027, giving SoftBank only six months to lock in more permanent financing. The bond sale will be split across US dollar and euro tranches, allowing SoftBank to tap a wider investor base and absorb the deal's size without overwhelming any single market.