SoftBank Group Corp is preparing to launch up to $20bn in US dollar bonds, adding to its existing €8.3bn of euro-denominated bonds and ¥6tn ($38.2bn) of yen bonds outstanding. This would make it a dominant player in global high-yield markets, potentially topping the ICE BofA Euro high-yield index and rivaling Charter Communications’ $25.9bn in US high-yield bonds. Despite having already issued $12.6bn of US dollar bonds, SoftBank’s weighting in the US high-yield index is zero because nearly all its dollar bonds are Reg S securities sold only outside the US to non-US persons.

This is largely due to SoftBank’s status as a foreign investment holding company since around 2017, which triggers restrictions under the Investment Company Act of 1940. The Act limits such entities’ issuance of debt in the US domestic market to prevent abuses seen before the 1929 crash. To issue bonds domestically, SoftBank must rely on Section 3(c)(7), requiring buyers to be both qualified institutional buyers and qualified purchasers—a higher bar that deters broader market access.

While not prohibited, the regulatory complexity makes domestic issuance challenging, explaining SoftBank’s preference for offshore sales despite its scale and market influence.