SoftBank’s $260 Billion Yen Bond and OpenAI Countdown: A Crucial Week for Japan’s New Top Stock
03.06.2026 - 16:15:02 | boerse-global.de
SoftBank Group’s brief coronation as Japan’s most valuable company came with an immediate reality check. The stock slid 3.67% to ¥8,315 on 3 June, one day after hitting a yearly high of ¥9,074, as investors weighed the euphoria of dethroning Toyota against a packed calendar of financial tests. The tech conglomerate now sports a market capitalisation of roughly ¥48.8 trillion, edging out Toyota’s ¥45.9 trillion after a 22-year reign by the automaker. But the spotlight has already shifted to 5 June, when SoftBank places a hybrid bond worth ¥260 billion (about €1.7 billion) that will gauge credit market confidence in its AI-fueled strategy.
The rally that lifted SoftBank to the top was powered by a double dose of artificial intelligence. Arm Holdings, the chip designer in which SoftBank holds nearly 90%, delivered robust earnings, while the group’s bet on OpenAI has swelled in value. SoftBank’s original cost basis in OpenAI of $34.6 billion now stands at an estimated $79.6 billion, according to company figures. Net profit for the last fiscal year soared to around ¥5 trillion, up from ¥1.15 trillion the prior year, with net asset value and pro-forma value both exceeding ¥40 trillion, underpinned by Arm and the Vision Funds.
The hybrid bond coming to market on 5 June carries a 35-year maturity with an issuer call option after five years. The coupon is set in a range of 4.8% to 5.6%, and the instrument is aimed primarily at Japanese retail investors. Proceeds will refinance an existing bond that becomes callable in July 2027. It is the second large retail offering in weeks — SoftBank sold ¥418 billion in retail notes in April, alongside dollar- and euro-denominated institutional tranches. The bond is subordinated, giving SoftBank the right to suspend interest payments under certain conditions, which raises risk for noteholders. Ratings agencies are expected to treat roughly half the volume as equity, improving the company’s leverage ratios.
Should investors sell immediately? Or is it worth buying SoftBank?
The timing is delicate. S&P Global Ratings revised SoftBank’s outlook to negative from stable in March 2026, while affirming its BB+ rating, pointing to liquidity risks and deteriorating portfolio quality. Credit default swaps for the group, already among the highest for any Japanese company, have climbed about 70 basis points since the start of the year. The final coupon will be a litmus test: a yield at the top of the range would confirm mounting investor unease, while a landing near the lower end would signal that faith in SoftBank’s AI thesis remains intact.
That thesis rests heavily on OpenAI’s planned initial public offering. SoftBank has invested $32.4 billion in the AI startup in the last fiscal year and committed another $30 billion, with $10 billion already wired in April. The total commitment is expected to reach $64.6 billion by October, representing an estimated 13% stake. OpenAI filed a confidential draft prospectus this spring, with Goldman Sachs and Morgan Stanley leading the underwriting syndicate. CEO Sam Altman is pushing for a September debut on the Nasdaq. Last private round valued OpenAI at $852 billion, and an IPO could push it past $1 trillion. Morningstar estimates that SoftBank’s OpenAI holding now accounts for about 26% of total assets, while Arm represents roughly 40% — together nearly two-thirds of the portfolio.
Yet a structural discount continues to cap the stock’s full potential. Over five years, the holding company discount to net asset value averaged 50%, and it widened to 55–60% in early 2025. Investors penalise the group’s intricate structure, despite the 90% surge in SoftBank’s share price year to date and Toyota’s 13% decline over the same period. Managing that discount will depend partly on a successful OpenAI listing and the market’s ability to value the underlying stakes directly.
SoftBank is also actively pruning its liabilities. On 9 June, it will early redeem a $669 million bond originally due in July 2026, a move that signals disciplined treasury management even as it taps new retail funding. Shareholders will get their next chance to question executives at the annual general meeting later this month. For now, the hybrid bond on 5 June offers the first clear read on whether the market buys SoftBank’s narrative of AI-driven value creation — or sees a leveraged bet that could unravel if the technology hype fades.
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