SoftBank Group has launched $10 billion and €1 billion in senior unsecured notes to fund its next payment toward OpenAI, a term sheet shows. The deal would rank as the largest Asia Pacific and Japan non-financial corporate bond sale on record, and Fitch has assigned the notes a BB+ rating.
SoftBank Group Corp has launched the sale of $10 billion and €1 billion ($1.15 billion) denominated senior unsecured notes to fund its investment in OpenAI, a term sheet showed on Monday. The dollar notes split into 3-1/2-year, 5-1/2-year and 7-1/2-year maturities, while the euro notes split into 4-year and 6-year maturities. SoftBank said it had no comment on the term sheet.
A record-setting bond sale
If completed at the planned size, the offering would be the largest Asia Pacific and Japan non-financial corporate bond deal on record, surpassing 7-Eleven Inc's $10.93 billion sale in January 2021, according to LSEG data. It would also rank among the 20 biggest corporate bond deals globally so far this year, Dealogic data showed. The issuances are expected to price on September 24 and settle on September 29, the term sheet said.
Funding the OpenAI payment
Proceeds will 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, the term sheet said. SoftBank had earlier secured a $10 billion bridge loan facility to fund the OpenAI investment, and the new bonds will cancel that facility, the term sheet said.
Fitch assigns a BB+ rating
Fitch Ratings assigned the proposed notes a BB+ rating. Fitch said it expects SoftBank's debt to rise as it funds committed investments, but the company should retain adequate liquidity and access to capital markets. Citigroup is the lead bookrunner for the dollar notes and JPMorgan the lead bookrunner for the euro notes, with Citigroup, Goldman Sachs, JPMorgan and Morgan Stanley acting as joint global coordinators for the dollar tranche.
Source: Investing.com
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