Softbank Group Corp (SFTBY.US) signed an unsecured bridge loan agreement totaling $40 billion on Friday, March 27. The funds will be used to support its investment in OpenAI, setting a new record for the group's single largest dollar-denominated loan while underscoring its strategic determination to secure a core position in the global artificial intelligence race. The financing was jointly underwritten by JPMorgan Chase, Goldman Sachs, Mizuho Bank, Sumitomo Mitsui Banking Corporation, and Mitsubishi UFJ Financial Group. According to the agreement terms, the loan has a maturity period of 12 months. Softbank Group Corp indicated plans to gradually repay the debt through asset sales and subsequent financing activities within the next year.
This latest bet on OpenAI follows Softbank Group Corp's previous infusion of over $30 billion into the startup. Upon completion of this funding round, Softbank Group Corp's cumulative investment in OpenAI will reach approximately $64.6 billion, increasing its ownership stake to about 13%. Currently, OpenAI represents one of Softbank Group Corp's largest holdings, alongside its approximate 90% stake in chip design company Arm Holdings Plc (ARM.US). Arm's stock price has surged more than 40% this year, primarily driven by its plans to sell proprietary chips. This development presents significant benefits for Softbank Group Corp, which holds stakes in hundreds of unlisted startups and maintains the capacity to fund substantial investments in artificial intelligence.
Bloomberg Intelligence notes that Arm's decision to sell its own chips will expand Softbank Group Corp's investment exposure in AI semiconductors. Since OpenAI is among the initial buyers, synergistic effects within Softbank Group Corp's AI ecosystem may emerge. Arm's business model will evolve as its market expands from pure design to chip sales, with management targeting annual revenue of $15 billion within five years, up from $5 billion in 2025, though profit margins are expected to decrease accordingly.
Regarding broader strategic synergies, Softbank Group Corp is not only establishing connections with OpenAI through capital injection but also planning deep collaboration in computational infrastructure. The company is currently developing a massive Piketon AI data center campus in Ohio, USA, with the first phase's construction cost estimated between $30 billion and $40 billion. OpenAI is expected to become a core tenant. This dual approach of "capital plus infrastructure" aims to create a vertical ecosystem covering computing power, models, and application layers.
However, the massive borrowing has raised concerns among credit rating agencies. S&P Global has revised Softbank Group Corp's rating outlook from "stable" to "negative" due to excessive risk exposure to a single asset on its balance sheet.
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