Shares of Japan’s SoftBank Group, listed on the Tokyo Stock Exchange, plummeted by 13% following reports that OpenAI might postpone its anticipated initial public offering (IPO). This delay raised worries about the timing of returns on SoftBank’s substantial investment in the artificial intelligence company. The decline marked the largest intraday fall for SoftBank in over three months, prompting investors and traders to reassess expectations surrounding the potential value from an OpenAI listing.
Advisers to OpenAI have reportedly warned about ongoing volatility in technology stocks, which could dampen interest in a public offering and potentially push the IPO timeline into the following year. By October, SoftBank is projected to have invested approximately $65 billion in the ChatGPT maker. The anticipation of an imminent OpenAI listing had driven a surge in SoftBank’s shares recently, propelling the company’s market capitalization above that of Toyota Motor Corp.
Moreover, a public listing of OpenAI is viewed as a significant catalyst for SoftBank, offering a clear market valuation for one of its major investments and simplifying the assessment of the group’s broader portfolio of privately held tech firms. Market observers believe that such a listing could help reduce the valuation discount at which SoftBank’s shares typically trade by minimizing uncertainty surrounding the value of its investment holdings. OpenAI, under the leadership of CEO Sam Altman, has reportedly submitted confidential paperwork for an IPO with the US Securities and Exchange Commission. The AI powerhouse is said to be collaborating with Goldman Sachs and Morgan Stanley on a potential listing, although the timing remains uncertain.
