SoftBank pitches big IPO to get loans from banks: sources

San Francisco

MASAYOSHI Son is asking Wall Street banks to open their pocketbooks if they want in on what could be the biggest-ever initial public offering, according to people familiar with the matter.

SoftBank Group Corp has told potential underwriters seeking a large role in the blockbuster IPO of its Japanese wireless unit that they should offer to lend to other parts of the parent company's empire, said the people, who asked not to be identified because the matter isn't public.

One option being discussed is banks lending a combined US$8 billion, said two of the people, with SoftBank's stake in British computer-chip designer ARM Holdings Plc being used as collateral, one of them said. Loans against stakes in other companies have also been considered as the group dangles the carrot of participating in the IPO of SoftBank Mobile. Firms offering financing are seen as much likelier to get a spot on the IPO, they said.

"There is no truth to this," SoftBank spokesman Takeaki Nukii said by phone, declining to comment further.

Shares of SoftBank fell 0.65 per cent to close at 9,940 yen (S$123) in Tokyo on Friday. The stock has gained 11 per cent this year compared with a 7.3 per cent drop in the Topix index.

No final decisions have been made about the structure of the loans or their collateral and SoftBank could still decide to give roles to non-lending banks as well, the people said. Some of the discussions have also included the idea of lending to SoftBank's almost US$100 billion Vision Fund, some of the people said. BLOOMBERG