Softbank Group launches over $10 billion in bonds for OpenAI investment, term sheet shows

SoftBank Group has launched over $10 billion in bonds to fund its investment in OpenAI. The dollar-denominated notes are split into 3.5-year, 5.5-year, and 7.5-year tenors, while the euro-denominated bonds are split into 4-year and 6-year tenors. According to the term sheet, the bond issuances are expected to price on September 24 and settle on September 29.

The bonds will be used to 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, and for general corporate purposes. SoftBank had earlier secured a $10 billion bridge loan facility to fund its OpenAI investment, which the bonds will cancel. Citigroup and JPMorgan are lead bookrunners of the notes.

Bloomberg reported that SoftBank is looking to issue $10 billion and €1 billion in debt for its OpenAI investment, in what would be one of the biggest junk bond sales ever. The bond sale comes as OpenAI anticipates significant negative free cash flow in the coming years, despite projected revenue growth.

Brief written by urgent.news from Economic Times Tech, Techmeme, Business Recorder, Investing.com, Straits Times Business — 5 reports on this story. Machine-written — may contain errors; check the original before relying on it.