SoftBank taps Arm shares for $5bn margin loan to fuel AI

SoftBank’s total margin borrowings tied to Arm shares will increase to $18.5 billion if the deal goes through. SoftBank intends to deploy the new funds into additional rounds of investment in OpenAI over the course of the year.

According to reports, SoftBank has already drawn $13.5 billion in margin loans against Arm stock as of March 2025, of which $5 billion remains undrawn. The fresh $5 billion tranche would bridge the gap, maxing out its collateral-backed borrowing capacity.

Arm’s shares have surged around 38 percent in 2025, the rally has strengthened its ability to tap the stock as collateral and raise more capital internally, without relying solely on bond markets or external equity issuance.

Masayoshi Son has staked much of SoftBank’s future on strengthening its ecosystem in AI. Earlier this week we revealed Softbank completed a $5.4 billion acquisition of ABB Ltd.’s robotics arm.

Last month SoftBank also announced five new U.S. AI data centre sites under project Stargate. The combined capacity from these five new sites, along with the flagship site in Abilene, Texas, and ongoing projects with CoreWeave, brings Stargate to nearly 7 gigawatts of planned capacity and over $400 billion in investment over the next three years. In January, OpenAI revealed plans to secure a $500 billion commitment for a 10-gigawatt project.

The margin loan would help fuel that pipeline of AI and robotics investments without reliance on capital markets.

Analysts have flagged that the company is fast approaching its 25 percent loan-to-value (LTV) limit due to the scale of its recent deals, from Arm-backed loans, ABB robotics acquisition and $6.5 billion Ampere acquisition announced earlier this year.

Before Arm’s IPO in 2023, SoftBank had secured roughly $8 billion in margin loans tied to the unit, with major backers like JPMorgan, Barclays, BNP Paribas, Credit Agricole, and Goldman Sachs structuring mandates around the IPO. Those same lenders are expected to play a role in the refinancing or expansion of margin debt.

JPMorgan estimates that $1.2 trillion in debt is now tied to AI investments, making it the largest segment of the investment-grade market. Concerns are rising as money flows between giants like SoftBank, Nvidia, and OpenAI, creating a tangled web of financial links that may be propping up valuations more through deals and funding flows as opposed to the companies’ underlying performance.

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