SoftBank group prices its biggest-ever yen bond worth $4.8bn

Bloomberg

SoftBank Group Corp. priced its biggest-ever yen bond on Thursday, using its popularity with retail investors to raise 550 billion yen ($4.8 billion) to pay off other debt.
Billionaire Masayoshi Son’s technology conglomerate, which made headlines last year due to losses on Chinese ride-hailing giant Didi Global Inc., has been the single-biggest issuer in the Japanese corporate bond market in the past decade. It sold the new seven-year subordinated note at 2.48%, according to underwriter Nomura Securities Co.
Son’s reputation for entrepreneurship means the company is popular among retail investors despite its high gearing. In comparison with payouts on Japanese government debt and notes from other local companies, its bonds offer attractive returns.
The yield on SoftBank’s new bond is a touch higher than the 2.40% for the company’s 450 billion yen of subordinated notes issued last September, reflecting the rise in borrowing costs for Japanese companies this year as global central banks begin unwinding their crisis-era stimulus.
The prospect of higher interest rates also prompted a selloff in technology companies shares this month.
“The pricing level seems appropriate,” said Toshiyasu Ohashi, chief credit analyst at Daiwa Securities Co. “The impact from global interest rises on tech shares is a factor that could change SoftBank’s credit standing, but the company has been controlling its finances.”
Bloomberg-compiled data show the company has at least $6.8 billion worth of bonds across currencies due this year including a note of more than 400 billion yen next month.
The conglomerate has an A- investment-grade rating from Japan Credit Rating Agency, while S&P Global Ratings
assigns it a junk rating.