A crucial year-end fundraising for US stocks AI belief! SoftBank pulls out all the stops for a sprint of $22.5 billion, Son Ye "AI dream" almost all bet on OpenAI.

Media reports, citing sources familiar with the matter, stated that the Japanese investment giant SoftBank Group, founded and led by legendary investor Masayoshi Son, is racing against time to complete its $22.5 billion funding commitment to the developer of ChatGPT, OpenAI, before the end of the year through a series of fundraising schemes. This includes selling a portion of its long-held investment portfolio and possibly using its valuable stake in the chip design leader Arm Holdings as collateral to borrow unused margin loans. This "heavy" bet by SoftBank on OpenAI is one of the largest to date in the field of artificial intelligence by Masayoshi Son. The Japanese billionaire, who gained fame for his early bet on Alibaba Group Holding Limited Sponsored ADR, is trying to establish SoftBank Group as a key player in the global AI competition. To raise funds, Son has sold all of SoftBank's $5.8 billion in profits from "AI chip" giant NVIDIA Corporation (NVDA.US) stocks and also sold $4.8 billion worth of shares in one of the US telecom operators, T-Mobile US (TMUS.US), and made significant staff reductions. Masayoshi Son's "super AI vision" as the founder of SoftBank, at the age of 67, focuses on SoftBank playing a core role in global AI proliferation similar to NVIDIA Corporation. It is without a doubt that Son, who gained fame for his early bet on Alibaba Group Holding Limited Sponsored ADR, hopes to enjoy the huge investment return brought by the global AI super wave. The core of this effort is through SoftBank's 90% stake in chip design leader ARM, and a $500 billion "Stargate" project in the US with OpenAI, Oracle Corporation, and the Abu Dhabi Technology Investment Fund MGX, as well as massive long-term investments in leading AI companies like OpenAI and Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR. Two sources familiar with the matter told the media that Masayoshi Son has slowed down most of SoftBank's "Vision Fund" other deal-making activities to near standstill, and now any transaction over $50 million requires his explicit approval. Sources say that SoftBank is moving forward with its digital payment app operator PayPay's IPO. The initial public offering (IPO) expected to take place this month has been postponed due to a 43-day US government shutdown that ended in November. Sources say that PayPay's IPO debut, which was supposed to raise over $20 billion, is now expected to take place in the first quarter of next year. One source directly familiar with the situation stated that the Japanese conglomerate is also seeking to monetize some of its stake in Didi Global, the dominant ride-hailing platform operator in the Chinese market. The two sources mentioned above stated that SoftBank's Vision Fund investment managers are being personally guided by Masayoshi Son to shift their focus towards the OpenAI deal. SoftBank's frantic fundraising efforts shed light on the pressures faced by even one of the world's largest dealmakers as they compete for funding for large-scale AI data center projects worth hundreds of billions of dollars. SoftBank officials have declined to comment. SoftBank has various options Sources indicate that OpenAI has not yet received the remaining funds, but it is expected that the money will be fully available by the end of 2025 as per the agreement. Sources state that SoftBank has various sources of cash that can be utilized, including margin loans, cash on the balance sheet, stakes in listed companies, or corporate bonds or bridge loans. Masayoshi Son has sufficient reason to use a variety of financing mechanisms to fulfill his funding obligations to OpenAI. In April, SoftBank reached an agreement to invest in OpenAI at a valuation of $30 billion. Since then, the valuation of OpenAI has risen significantly, and the AI startup is actively negotiating, including a multi-billion dollar investment from Amazon.com, Inc. (AMZN.US), which, according to one source, will raise its valuation to nearly $900 billion, triple the amount; once the deal is completed, this huge investment in OpenAI will bring significant profits to SoftBank. One major source of funds for SoftBank comes from the margin loans taken out using the stakes in the UK-based semiconductor and software design company Arm Holdings as collateral. It is understood that SoftBank recently increased its margin loan limit by $6.5 billion, bringing the unused total limit to $11.5 billion. The ARM stock has tripled its IPO price, providing SoftBank with a larger collateral space to expand its financing and borrowing capacity. SoftBank reported that as of September 30, the cash at the parent company level was approximately 4.2 trillion ($27.16 billion). According to LSEG data, the group still holds about 4% of T-Mobile US shares, making it the second largest shareholder in the US wireless operator; as of the end of September, this stake was worth approximately $11 billion. Although SoftBank's investment pace is not as active as before, it continues to support AI startups like Sierra and Skild AI. Both OpenAI and Oracle Corporation greatly need this money Both OpenAI and SoftBank are key participants in the "Stargate" project, a $500 billion plan to build large-scale AI data centers for training and reasoning within the US. The race to build data centers has also prompted massive tech giants, including Oracle Corporation, Microsoft Corporation, and Meta Platforms (META.US), to promise unprecedented levels of funding for these constructions - which require massive AI chips, power, cooling equipment, and clusters of servers, and to bring in deep-pocketed partners to share the risk. Since November, these tech giants have heavily debt leveraged and deeply laid out AI computing cluster cloud computing leader Oracle Corporation could not deliver a satisfactory performance report, the extremely heavy capital expenditure of these tech giants has sparked serious concerns about "what if these investments fail to bring adequate returns," exacerbating the looming specter of the burst of the "AI bubble." In April, SoftBank promised to invest up to $30 billion in OpenAI - of which $10 billion was delivered to the startup that month. The remaining amount depends on the AI startup transitioning to a for-profit company by the end of the year; a bold move that OpenAI has already accomplished in October. This new funding is crucial for OpenAI to cover the escalating costs of training and running its cutting-edge AI models, as competition pressure from Alphabet's Alphabet Inc. Class C continues to intensify. OpenAI CEO Sam Altman recently told employees that the company is entering a "red alert" phase to improve ChatGPT with all its might - even postponing the launch of other products to fend off the strong momentum from Alphabet Inc. Class C Gemini. In October, Altman stated that OpenAI aims to build a 30-gigawatt AI computing infrastructure at a cost of $1.4 trillion. He said he ultimately wants OpenAI to add 1 gigawatt of computing power per week - a huge and seemingly unattainable goal, as currently every 1 gigawatt comes with a capital cost of over $400 billion. This substantial financing from SoftBank is not only crucial for OpenAI but also crucial for Oracle Corporation's financial fundamentals and even for the sustainability of the entire US stock market AI investment frenzy. The market is beginning to worry that OpenAI may not generate enough revenue to pay for its commitments to AI computing infrastructure providers like Oracle Corporation and CoreWeave. This concern even led to a downgrade in debt rating for Oracle Corporation by Barclays PLC Sponsored ADR, with credit default swaps (CDS) spreads rising to about 156 basis points, the highest in 16 years, and the market even starting to price in bankruptcy risk for the next five years. Therefore, this round of OpenAI funding has a significant boost effect on the AI computing industry chain. The funds received by OpenAI will mainly be used to pay for computing costs, meaning that AI data center service providers like Oracle Corporation will have a continuous and stable source of revenue.