SoftBank Group Corp. (SFTBY, Financials), the Japanese technology investment company, arranged a $10 billion loan backed by its ownership in OpenAI as it continues to finance an increasingly concentrated artificial-intelligence strategy.
The two-year facility was provided by lenders including Goldman Sachs, JPMorgan Chase, Mizuho, Apollo and Sumitomo Mitsui. SoftBank expects to draw the funds this month for general corporate and investment purposes.
The agreement includes protections for lenders if the value of OpenAI's preferred shares falls sharply. Under certain conditions, SoftBank may have to provide additional cash or repay part of the borrowing early.
The loan follows a separate $40 billion bridge facility connected to SoftBank's OpenAI investments. Its total commitment to the ChatGPT developer is expected to reach approximately $65 billion by October.
The financing could magnify SoftBank's gains if OpenAI's valuation continues to rise. It also increases balance-sheet risk because the collateral is tied to a privately held company with uncertain future returns.
Investors will watch OpenAI's valuation, SoftBank's debt levels and whether its AI investments begin generating enough cash to support the added leverage.