SoftBank Group has raised $11.1bn in dollar- and euro-denominated bonds in the largest high-yield corporate bond sale globally on record as the tech investment conglomerate seeks to fund its mammoth bet on OpenAI.
The deal is the latest example of how AI investments have led to a surge in corporate borrowing this year, adding to major bond sales from large tech firms like Amazon and Alphabet.
The funding follows a ¥1tn ($6.3bn) bond issue aimed at retail investors this month, and is likely to prompt further scrutiny of SoftBank's finances, which could become vulnerable should market sentiment towards OpenAI and the artificial intelligence sector weaken significantly.
Under the leadership of Masayoshi Son, known for bold bets throughout his long career and now keen to make the Japanese firm the dominant investor in AI, SoftBank has committed $64.6bn to the ChatGPT-maker, of which it will own roughly 13% by next week.
It is also acquiring ABB's robotics business for $5.4bn and DigitalBridge for $3.1bn.
The sheer size of its AI-related investments and the amount of money it has sought to fund them has led to higher yields to pay for SoftBank, which has long been a junk-bond issuer, as well as jumps in the cost of insuring its debt against default.
"I was positively surprised by the market appetite," said Satoru Aoyama, senior director at Fitch Ratings. "Hyperscalers in the US have been raising debt but they have high credit ratings.
Now AI-driven debt issuance has reached the high-yield market at scale."
The value of bond sales from hyperscalers has more than doubled this year to over $200bn, according to LSEG data. Analysts expect more to come this year.
But the sheer scale of that borrowing has been one of the factors putting pressure on global borrowing costs, which have surged in recent weeks, as the competition for capital heats up.
SoftBank issued dollar-denominated senior notes of $1bn at a 3-1/2-year term, $4.5bn at 5-1/2 years and $4.5bn at 7-1/2 years, a filing showed. The bonds pay interest rates of 8.625%, 9.25% and 9.75% respectively.
It also issued two €500mn tranches of euro-denominated senior notes with terms of four and six years, yielding 7.125% and 8%.
By comparison, a $7.3bn SoftBank issuance in June 2021 of senior dollar- and euro-denominated bonds yielded between 2.125% and 5.25%.
Like SoftBank, hyperscalers have also expanded their borrowing beyond the US dollar bond market, increasingly tapping the euro and other currencies this year to diversify their funding sources given their massive financing needs.
The sale marks the largest high-yield corporate bond issuance globally to date, surpassing French telecoms firm Numericable Group's $10.9bn issuance in 2014, LSEG data showed.
SoftBank has issued $14.6bn in high-yield bonds so far in 2026, making up 63.4% of the Asia Pacific and Japan high-yield corporate bond market.
It has also sold off assets and taken out loans backed by its holdings in chip designer Arm and OpenAI to fund its commitments.
SoftBank's hopes for an influx of cash through the public listings of OpenAI and data centre development subsidiary SB Energy were dented in recent weeks as both delayed IPO plans that were set to launch as early as this month.
"Risks for SoftBank credit are material and have increased as concentration has increased and cash flow has come under material strain," CreditSights' head of telecom and media Mark Chapman wrote in a note.
SoftBank's holdings in Arm and OpenAI make up three-quarters of the group's asset value at current levels, he calculated.
The cost of insuring SoftBank's debt against default has shot up, with the 5-year credit default swap spread exceeding 400 basis points this week, compared with around 280 basis points in June.
However, S&P Global Ratings' Makiko Yoshimura wrote in a note that Arm's strong share price performance has supported SoftBank's credit quality such that the delay to OpenAI's IPO does not have an immediate negative impact on SoftBank's creditworthiness.
