SoftBank pays up to 9.75% to fund its next OpenAI investment

SoftBank has raised $11.1 billion in the world’s largest high-yield corporate bond sale, using the debt market to help finance its next $10 billion payment into OpenAI. High-yield, or “junk,” bonds are issued by companies below investment-grade credit ratings, so investors demand higher returns for taking more risk; SoftBank offered yields ranging from 7.125% to 9.75%. The money is intended for the final installment of a $30 billion follow-on investment in the ChatGPT maker, due to close October 1, with the remainder available for general corporate purposes. The sale shows that Masayoshi Son can still attract vast funding for his AI ambitions, but at a price that makes the bet more consequential: OpenAI’s upside now has to justify not only an enormous equity commitment, but also costly borrowed money.