SoftBank Secures $11.87 Billion Loan for OpenAI Investment

SoftBank Group secured an $11.87 billion two-year loan from approximately 20 banks to fund its investment in OpenAI. The loan exceeds the company's initial $10 billion target and is part of a broader financing strategy to support a cumulative investment expected to reach $64.6 billion by October. This capital injection will grant SoftBank roughly 13% ownership of the AI firm.

To date, the conglomerate has raised approximately $37 billion this year through loans and bond sales. SoftBank is also considering a US dollar junk-bond sale of $10 billion to $20 billion and recently repaid $25.9 billion of a separate $40 billion loan. Despite securing the financing, SoftBank shares fell as much as 13% on Monday.

The investment comes as OpenAI CEO Sam Altman called for a slower pace of AI development and confirmed the company will not pursue a public offering this year to address safety-related concerns. CFO Sarah Friar indicated that the pause on IPO plans may last until 2027. This delay complicates the valuation of SoftBank's stake, which relies on private valuations that could reach $1.5 trillion in a new funding round.