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SoftBank is planning to buy up to $1.5bn worth of stock in OpenAI to bolster its position in the $150bn artificial intelligence company as Masayoshi Son seeks to position the Japanese group as an artificial intelligence leader.
SoftBank will buy the shares through a tender offer, a mechanism which allows current and former OpenAI employees who have held their stock for more than two years to sell, according to two people familiar with the situation. The deal is set to close early next year.
The tender offer, first reported by CNBC, prices employee stock according to OpenAI’s last funding round, which was completed last month. That $6.6bn fundraise valued the company at $150bn.
SoftBank’s second Vision Fund, its tech-heavy investment vehicle, invested $500mn in the company during that round. The same fund, in which Son has a substantial stake, is also buying the $1.5bn in shares.
AI start-ups have raised tens of billions in debt and equity this year, as investors look past eye-watering valuations for lossmaking companies to make bets on the technology.
Elon Musk is expected to close a $5bn funding round for his AI start-up xAI this week, to value the year-old group at $45bn, while OpenAI’s valuation has nearly doubled this year. Last week, rival Anthropic received a second $4bn investment from Amazon.
Son has publicly expressed his admiration for Sam Altman and has said he frequently talks to the OpenAI chief executive. The tech investor has been seeking a larger stake in the company, according to people familiar with the matter.
SoftBank’s additional investment makes the company one of OpenAI’s largest backers alongside Josh Kushner’s Thrive Capital, which has poured more than $1bn into the group. Tiger Global, Altimeter Capital, Coatue Management and Abu Dhabi-based tech investment firm MGX have also made substantial bets on the company.
Microsoft, OpenAI’s most important partner, has invested more than $13bn.
Son is currently trying to execute an ambitious AI plan to put his company at the centre of developments in artificial intelligence.
“This is what I was born to do, to realise ASI [artificial super intelligence],” said Son earlier this year.
The group is the majority owner of Arm Holdings, the UK-based chip designer that has been a beneficiary of the AI boom and is central to Son’s AI ambition.
SoftBank and OpenAI declined to comment.
