SoftBank shares tumble as $6 billion OpenAI‑backed loan stalls

SoftBank Group’s effort to secure a $6 billion margin loan backed by its stake in OpenAI has stalled, prompting the Japanese conglomerate’s shares to fall almost 10% in early trading on June 10 2024 [2]. The setback follows a recent reduction of the loan target from $10 billion and adds pressure to the group’s high‑leverage balance sheet.

Key takeaways

• SoftBank’s margin‑loan talks stalled after lenders balked at valuing its private OpenAI stake [1]
• The share price dropped about 9‑10% after the news, wiping out roughly ¥5 trillion in market value [1]
• SoftBank still faces a ¥40 billion ($40 billion) unsecured bridge loan maturing in March 2027, heightening liquidity concerns [1]
• The company had previously secured roughly ¥5 billion of commitments, though it is unclear if those were formal [3]
• OpenAI’s confidential IPO filing may improve collateral valuation, but lenders remain wary of illiquidity and competitive pressure from rivals such as Anthropic [1]

Stalled loan negotiations and market reaction

Sources familiar with the matter told Bloomberg that SoftBank’s discussions with potential creditors “failed to progress,” weeks after the firm cut its loan target by 40% from $10 billion to $6 billion [2]. Lenders struggled to price the private OpenAI stake as collateral, citing valuation uncertainty and the lack of a liquid market for the asset [4]. Some creditors also raised concerns about OpenAI missing internal sales or user‑growth milestones, further dampening appetite for the loan [4].

The news sent SoftBank’s shares sharply lower. By 05:25 GMT, the stock was down nearly 10% to ¥6,372, and the decline continued, with the Japan Times reporting a slide of as much as 9.7% on the day [4]. The drop erased more than ¥5 trillion in market capitalisation in a single session, adding to volatility that saw the company briefly surpass Toyota as Japan’s most valuable firm before the plunge [1].

Debt backdrop and financing options

SoftBank’s liquidity concerns are amplified by a large unsecured bridge facility of ¥40 billion, arranged with JPMorgan, Goldman Sachs and three Japanese banks, which is due in March 2027 [3]. The group has said it will repay the bridge loan using existing assets and other financing measures, potentially including asset sales, bond issuances or borrowing against listed holdings such as Arm and Intel [3].

While SoftBank has reportedly secured about ¥5 billion of commitments for the margin loan, it is unclear whether those were binding agreements or preliminary expressions of interest [3]. The company remains exploring alternative fundraising routes and may revisit the margin‑loan structure after OpenAI’s planned IPO, which could provide a clearer market price for the collateral [1][2].

Why it matters

The stalled loan underscores the difficulty of leveraging private‑company stakes in a tightening credit environment, especially for a conglomerate with a high‑leverage profile. SoftBank’s ability to meet the ¥40 billion bridge‑loan deadline hinges on finding new financing sources, and the failure to lock in the $6 billion margin loan raises doubts about its short‑term liquidity. Investors will be watching OpenAI’s IPO progress closely, as a successful public listing could unlock more favorable terms for future secured loans. Until then, SoftBank’s balance sheet remains under scrutiny, and further share volatility is likely.