{"text":[[{"start":11.778,"text":"SoftBank’s US data centre developer has run up against market fears about the strength of the AI boom, leading the company to slow its initial public offering timeline as it also faces lukewarm interest in a potential $5bn debt sale."}],[{"start":25.006,"text":"SB Energy, backed by Masayoshi Son’s Japanese investment group as well as OpenAI and Nvidia, hopes to go public at a valuation of about $50bn, despite having yet to bring a single data centre online."}],[{"start":38.132,"text":"But in the face of market jitters about demand for computing power, SB Energy has slowed the process, waiting for investor sentiment towards data centres to steady before pressing ahead, said people familiar with the matter."}],[{"start":49.877,"text":"SB Energy still intends to go ahead with the IPO and is evaluating market conditions as it moves through the listing process, one person close to the company added. The New York Times first reported the altered timeline."}],[{"start":62.506,"text":"It becomes the second company in a week to be wrongfooted by concerns about a slowdown in the AI sector. Nuclear energy group Holtec International, which hoped to supply power to AI data centres, last Wednesday delayed its listing by at least three months."}],[{"start":76.947,"text":"Holtec’s chief executive Kris Singh said it faced a “perfect storm” of adverse “market sentiment” around AI data centres."}],[{"start":84.048,"text":"Investors are concerned that pledges from leading AI labs Anthropic and OpenAI to slow model development in the name of safety could lead to lower demand for computing power, even as Anthropic prepares its own IPO."}],[{"start":96.384,"text":"Some fear the political backlash to data centre constructions and the risks AI poses could also lead to new regulations that curtail the boom surrounding the technology."}],[{"start":106.486,"text":"SB Energy also held talks with investors in recent weeks for a potential $4.9bn debt sale on the back of its IPO, according to people familiar with the matter."}],[{"start":116.092,"text":"After early discussions, investors expect the debt to offer a yield of about 10 per cent, pricing that would indicate a junk credit rating, the people said. Citi, which is leading the debt deal, declined to comment."}],[{"start":127.824,"text":"The person close to SB Energy said the company was focused on the IPO and would explore raising the additional debt after the listing."}],[{"start":134.888,"text":"SB Energy said in filings on Monday that Nvidia had spent $1.5bn in August purchasing its shares at a 10 per cent discount to their eventual listing price and would buy an additional $1.5bn worth of shares at the IPO price, taking the chip group’s total investment to $3bn."}],[{"start":154.285,"text":"Investors are also concerned about SB Energy’s heavy reliance on OpenAI as a customer, particularly given the lossmaking start-up’s recent pledge to slow AI development, the people added."}],[{"start":166.16,"text":"OpenAI has delayed its own IPO and is in talks for a private funding round that could value it at about $1.2tn. The delay has heaped pressure on SoftBank, which has committed more than $60bn to Sam Altman’s AI start-up."}],[{"start":180.962,"text":"SB Energy has not published a public credit rating, but the company has leaned on the credit support from its infrastructure partners to lower borrowing costs for its projects."}],[{"start":191.255,"text":"Nvidia agreed to provide up to $105bn of backstop for SB Energy’s data centre campus in Pike County, Ohio, which is leased to OpenAI for 20 years and is shaping up to be the world’s largest data centre."}],[{"start":204.76,"text":"SB Energy warned in its prospectus that the data centre projects it needs to fulfil its current contracts would require $174bn of investment."}],[{"start":212.534,"text":"The company said it planned to fund the majority through project-level debt but cautioned that it “may face difficulty securing the quantum of capital required to fund our project pipeline, particularly if the debt capital markets tighten”."}],[{"start":228.56,"text":"In its IPO filing, SB Energy said it would “incur a substantial amount of additional indebtedness” to refinance near-term maturities and fund projects in the pipeline, putting equity investors in unfavourable positions. Existing debt covenants also prohibit the company from paying any cash dividends before 2029."}],[{"start":249.99,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1790056647_9815.mp3"}