TOKYO — SoftBank Group Corp. priced a ¥90 billion bond offering Wednesday, securing roughly $550 million from institutional investors. The debt carries the highest coupon for a yen-denominated corporate bond issued this year, reflecting tighter conditions in Japan's corporate debt market.
The elevated yield signals investor demand for higher returns from a heavily leveraged issuer. It also positions SoftBank's offering as a pricing benchmark for other domestic issuers seeking capital.
Proceeds will fund SoftBank's artificial intelligence investments. The company has committed substantial capital to AI infrastructure and related ventures across its portfolio, including through its Vision Fund, which has deployed billions into AI startups globally in recent years.
Institutional investors acquired the entire ¥90 billion issuance. Their participation reflects continued demand for fixed-income assets offering attractive yields, even from highly leveraged issuers like SoftBank.
Japan's corporate bond market has seen increased activity as companies move to lock in funding. The Bank of Japan's gradual policy adjustments have introduced more volatility and yield opportunities, pushing up corporate borrowing costs.
Issuing a domestic yen bond also diversifies SoftBank's funding base, reducing reliance on foreign capital markets and providing a natural hedge against currency fluctuations for its yen-denominated liabilities.
The high coupon raises SoftBank's cost of capital. The company's balance sheet will absorb increased interest expenses from this offering, and returns from its AI portfolio must exceed those funding costs to justify the debt.
