SoftBank Group is in discussions to invest as much as $30 billion more in OpenAI, a sharp increase in commitment that reflects founder Masayoshi Son¡¯s ambitions to play a central role in developing artificial intelligence.
The Japanese company, already one of the ChatGPT-maker¡¯s biggest backers, is in deliberations to commit more capital toward the fast-growing startup, people familiar with the matter said. The maximum amount SoftBank is considering is $30 billion, one of the people said, asking to remain anonymous to discuss private talks. They cautioned that the discussions are fluid and the amount of funding could change. SoftBank¡¯s shares rose 5.8% in Tokyo on Wednesday.
Son has been unwinding positions to increase its stake in OpenAI and ready capital for sweeping investments aimed at injecting AI in all devices. It sold its stake in Nvidia and recently hit pause on talks to buy out U.S. data center operator Switch. The Tokyo-based company had amassed an 11% stake in OpenAI, injecting $22.5 billion just last month.
SoftBank representatives declined to comment on the prospective investment, which The Wall Street Journal earlier reported.
OpenAI Chief Executive Sam Altman has been meeting with top investors in the Middle East to line up funding for a new investment round that could total at least $50 billion, people familiar with the matter have said. The ChatGPT maker is looking to raise $50 billion or more in the round at a valuation of about $750 billion to $830 billion, the people said. The talks are early, and the amount could change.
Despite being early to invest in AI technologies, SoftBank has largely missed out on a global rush to build the semiconductors, server racks and other hardware to support machine learning, with the lion¡¯s share of money flowing to a small circle of chipmakers including Nvidia and Taiwan Semiconductor Manufacturing Co.
SoftBank has sharply increased its bets in AI in recent months. Over the past year, the Tokyo-based company has bought U.S. chip designer Ampere Computing for $6.5 billion and announced a $5.4 billion acquisition of ABB¡¯s robotics unit. To finance some of that cost, SoftBank has sold down its T-Mobile US shares, unloaded its entire Nvidia stake and expanded a margin loan using its Arm shares.
SoftBank¡¯s investments in AI, along with the sharp drop in the value of Arm shares at the end of last year, are heaping pressure on its creditworthiness, S&P Global Ratings warned earlier this month.
With your current subscription plan you can comment on stories. However, before writing your first comment, please create a display name in the Profile section of your subscriber account page.