SoftBank Group Corp is getting ready to return to overseas debt market for the second time in two months after issuing $4.5 billion in dollar-denominated subordinated notes in July.
Headed by billionaire founder Masayoshi Son, SoftBank is accelerating deal-making around the world, and has been in discussions to combine its US wireless operator Sprint Corp with a potential partner. The SoftBank Vision Fund has also kicked off investments, with deals ranging from ride sharing, co-working and robotics to agriculture, cancer detection and autonomous driving.
SoftBank is holding investor calls on Friday for potential US dollar, euro note sales, according to a person familiar with this offering, who is not authorised to speak publicly and asked not to be identified. The Japanese internet giant has mandated Deutsche Bank AG, Citigroup Inc, Goldman Sachs Group Inc and Morgan Stanley for the deal.
SoftBank’s bond issuance swelled since 2013, when it bought Sprint, and the company had net debt of 13.6 trillion yen ($125.4 billion) at the end of June. That debt is offset by the company’s unrealised profits in a plethora of companies, led by Alibaba Group Holding Ltd.
Moody’s Investors Service said in a note on Friday it expects SoftBank to use a substantial part of the proceeds to refinance existing bank loans, and that the issuance will have only “limited impact” on the company’s gross debt and leverage. It assigned ratings to dollar notes due in 2024 and 2027, and euro-denominated notes maturing in 2025 and 2029.
SoftBank’s new issue is expected to be rated Ba1 by Moody’s and BB+ by S&P Global Ratings.
SoftBank sold $2.75 billion dollar-denominated perpetuals, callable after six years, and $1.75 billion of perpetuals, callable after 10 years in July. The non-call 10-year perpetual, which priced at par on July 12 was at 102.83 cents on the dollar at 4:15pm in Tokyo. SoftBank last sold euro-denominated bonds in July of 2015. It priced 7-year, 10-year and 12-year notes.
Son is known for bold decisions and has spoken, without irony, about his 300-year plan for SoftBank and aims to build the world’s most valuable company. His Vision Fund set up last year had raised more than $90 billion for tech investments by July, winning backing from Saudi Arabia, Abu Dhabi, as well as Apple Inc and Qualcomm Inc
Operating profit at SoftBank was 479.3 billion yen in the fiscal quarter ended June 30, topping analysts’ projections, as Sprint returned to profit for the first time in three years. Sales came in at 2.19 trillion yen, matching predictions.
