SoftBank completes $41 billion OpenAI investment, takes 11% stake

SoftBank Group said it has completed a $41 billion investment in OpenAI, one of the largest private funding rounds on record, giving the Japanese conglomerate an estimated stake of about 11 per cent in the ChatGPT maker.

SoftBank chief executive Masayoshi Son has gone all in on OpenAI and is accelerating investments in artificial intelligence and related infrastructure, aiming to benefit from rising demand for the computing capacity that underpins AI applications, according to a Reuters report.

The completion of the OpenAI funding round comes days after SoftBank unveiled a deal to acquire digital infrastructure investor DigitalBridge Group in a transaction valued at $4 billion.

SoftBank stated on Wednesday that it has completed an additional $22.5 billion investment in OpenAI after investing $7.5 billion in April. OpenAI also received an upsized syndicated co-investment from other backers worth $11 billion, SoftBank informed.

In March, SoftBank had agreed to invest up to $40 billion into a for-profit subsidiary of OpenAI, with the funding structured as a mix of direct capital and syndicated co-investment from other investors.

The transaction valued OpenAI at around $300 billion on a post-money basis, although a subsequent secondary stock sale completed in October valued the company at approximately $500 billion, according to Pitchbook data. CNBC first reported the development earlier in the day.

Artificial intelligence has become the central axis of global technology markets this year, driving a surge in investment by the world’s largest companies and reshaping investor expectations.

OpenAI has emerged as a key pillar of the industry-wide AI spending wave. The ChatGPT maker, along with Oracle and other stakeholders, has planned a project dubbed Stargate, a large, multi-year data centre initiative designed to support next-generation AI models, with backing from major investors including SoftBank.