Key points
- SoftBank’s sharp drop in Tokyo
- What its new bonds cost
- Its growing OpenAI exposure
- Rising costs to insure its debt
SoftBank Group (9984.T; U.S. ADR: SFTBY) fell 8.5% in Tokyo on Tuesday, October 13, as chip and AI stocks sold off across Asia. Its shares closed at 5,310 yen, more than 38% below their June 2 record of 8,632 yen.
The selloff puts fresh attention on SoftBank’s debt-funded bet on OpenAI. Three weeks earlier, it priced roughly $11.1 billion in bonds carrying annual coupons as high as 9.75%. Bloomberg described the offering as one of the largest corporate junk-bond sales ever.
Those bonds are rated below investment grade, meaning investors demand higher returns for taking greater credit risk. SoftBank used the proceeds to fund its latest OpenAI investment.
New bonds carry coupons up to 9.75%
SoftBank priced five tranches on September 24: three in US dollars and two in euros. The longest dollar bonds, due in 2034, carry the highest annual coupon at 9.75%. A coupon is the yearly interest a bond pays on its face value. All five were sold at 100% of face value, so at issue each coupon matched the bond's yield.
| Currency | Amount | Annual coupon | Matures |
|---|---|---|---|
| Dollar | $1.0 billion | 8.625% | April 2030 |
| Dollar | $4.5 billion | 9.250% | April 2032 |
| Dollar | $4.5 billion | 9.750% | April 2034 |
| Euro | 500 million euros | 7.125% | October 2030 |
| Euro | 500 million euros | 8.000% | October 2032 |
Source: SoftBank Group, September 24, 2026.
In an analysis published Wednesday in Tokyo, Reuters compared that 9.75% coupon with Alphabet's 5.2% coupon on notes due in 2033, which Alphabet sold in August, according to its prospectus. AI borrowers with top credit ratings have also been paying more to borrow as their bond sales pile up. SoftBank is now one of the nine AI borrowers whose bonds AIStockWire's AI Bubble Index tracks.
The money went to OpenAI
On October 1, SoftBank paid the third and final $10 billion installment of its $30 billion follow-on investment in OpenAI, using the bond proceeds, the company said. Its total investment in OpenAI now stands at $64.6 billion, for an ownership stake of about 13%.
Alex Clavel, CEO of SoftBank Investment Advisers, said in the analysis that the company borrowed instead of selling holdings. "We've borrowed money in large part because we don't want to sell assets that we believe will keep rising in value," he said. "Given OpenAI's appreciation to date, 9.75% is still very reasonable."
Investors are paying more to insure SoftBank's debt
The price of credit default swaps on SoftBank debt, which work like insurance against a default, has risen 24% since June, according to the same analysis. Over that stretch, the shares have fallen more than 38%.
The analysis also noted that SoftBank's energy unit, SB Energy, is preparing a U.S. listing that could value it at as much as $50 billion.
SoftBank shares rose 2.8% to 5,461 yen in early Tokyo trading on Wednesday, as of 9:23 a.m. local time.
