S&P rates SoftBank notes BB+

S&P said it gave BB+ ratings to SoftBank Group Corp.'s planned senior unsecured notes. The dollar- and euro-denominated notes differ in maturities and base interest rates.

“The issue rating on the proposed notes is equal to the long-term issuer credit rating on the company. This is because we estimate the company's priority debt ratio (the sum of an issuer's total secured debt, including margin loans divided by the issuer's total debt) is significantly below 50%. That is the threshold for us to consider notching down the issue rating to reflect risk arising from structural subordination of the debt,” S&P said in a press release.

SoftBank will use the proceeds to partly repay debt.

“The proposed notes have a limited impact on SoftBank's credit quality. and we believe the company's loan-to-value ratio (as we calculate it) will remain at about 25%-30% in the next one to two years, a level commensurate with the rating. The ratio was approximately 22%-24% as of the end of March 2021,” the agency said.

The outlook is stable.

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