SoftBank Seeks $100bn Gulf AI Fund

SoftBank founder Masayoshi Son is seeking up to $100bn from Gulf investors for a fund that would acquire companies and overhaul their operations using artificial intelligence, according to the Financial Times. Son has held discussions with senior figures in the UAE in recent weeks, people familiar with the matter said. SoftBank declined to comment, and there is no guarantee the talks will produce an agreement.

The proposed strategy would extend Son’s AI ambitions into the operations of acquired businesses, with Roze, SoftBank’s robotics and physical AI unit, expected to play a central role. Son hopes to float that business at a high valuation. Gulf capital has supported his ambitions before: Abu Dhabi’s Mubadala and Saudi Arabia’s Public Investment Fund backed the first $100bn Vision Fund in 2017. Abu Dhabi has since become a major AI investor through MGX and G42.

The fundraising push comes as investors reassess SoftBank’s exposure to OpenAI, into which it has invested $65bn, following a delay to the company’s flotation. SoftBank shares fell 5% on Friday after the FT reported that OpenAI’s annualised revenue was about $20bn below previously signalled levels. The stock remains 25% higher this year but more than 30% below its June peak. Senior SoftBank executives maintain that short-term changes in OpenAI’s valuation will not derail their plans.

Financing costs add another consideration. SoftBank completed a junk-bond offering exceeding $11bn last month, with yields reaching 9.75%, and also borrows against part of its Arm holding. Its end-June loan-to-value ratio was 13%, below its 25% ceiling, against net asset value of ¥72.3tn. Outside capital could broaden its capacity to invest. For prospective backers, the assessment will combine Son’s record, spanning Alibaba’s success and WeWork’s bankruptcy, with whether AI can deliver improvements in acquired companies while justifying the scale and cost of the proposed investment.