SoftBank's SB Energy Considers Delaying IPO to Next Year as Investors Resist $60 Billion Valuation

SoftBank Group's data center developer SB Energy is weighing a delay of its share sale until December of this year or into next year, BigGo Finance reported. An earlier target had been to list as soon as September.

The company has signed data center revenue agreements worth $430 billion, with most tied to an 8.5 gigawatt artificial intelligence campus it is building for OpenAI in Ohio. That project will not begin operating in phases until 2028.

Underwriters have suggested a valuation near $60 billion, but IPO investors have pushed back on that price, according to BigGo Finance. First-half revenue came to $139 million, mostly from the existing power sales business. A $60 billion price tag would mean a multiple above 200 times sales. The $430 billion in orders is the total contract value across multi-year periods, not cash on hand; the rent would be recorded over 15- to 20-year lease terms only after each facility enters service.

The offering was intended to raise $5 billion to $7 billion to fund construction of the Ohio campus, which will use Nvidia chips and be leased by OpenAI. Nvidia has supplied a $105 billion credit backstop, though it is a conditional cap on certain lease and power payments for roughly 4.25 gigawatts of IT load rather than cash already paid.

BigGo Finance said stress in AI infrastructure finance is shifting from credit markets to equity listings. The publication cited rising CoreWeave bond yields and the withdrawal of Australian cloud operator Firmus's IPO. Other share sales have also hit obstacles: Singapore's DayOne Data Centers is considering delaying its listing or reducing the amount raised, and Blackstone-owned AirTrunk has postponed its Singapore REIT listing, BigGo Finance reported. The 10-year U.S. Treasury yield reached as high as 5.34 percent, and the Philadelphia Semiconductor Index fell 6.7 percent on October 22. SB Energy's management is watching the Anthropic listing expected next month before deciding whether to proceed with a December offering.

Credit signals are similar. The 2031 CoreWeave bond trades at a 15.76 percent yield, and the five-year credit default swap spread is 1,115 basis points, BigGo Finance reported. SoftBank paid a 9.75 percent coupon on 7.5-year dollar notes in September, with most of the proceeds earmarked for its OpenAI investment and general corporate purposes. Reuters Breakingviews estimated that just a tenth of the associated data center contract revenue would be received within six years.

If the listing slips further, the company has some buffer: Nvidia injected $1.5 billion in equity in mid-August, and SB Energy held $1.2 billion in cash and equivalents as of June 30. The Ohio project requires over $100 billion in total capital, and being public would make future debt issuance cheaper, BigGo Finance reported.