SoftBank Targets $50 Billion Data Center Giant in Aggressive Pursuit of AI Infrastructure Control

SoftBank Group Corp., headed by founder Masayoshi Son, is reportedly evaluating major acquisition opportunities as it looks to strengthen its position in the rapidly expanding market for AI-related digital infrastructure. According to people familiar with the discussions, the company has held preliminary meetings with Switch Inc.—a prominent operator of data centers—and is reviewing the firm’s operations as part of an ongoing due diligence process.

This potential acquisition reflects Mr. Son’s ambition to deepen SoftBank’s role in the accelerating competition around artificial intelligence, an area where partner company Nvidia Corp. has achieved extraordinary market dominance. Owning Switch, which specializes in large-scale, energy-efficient data center design and management, would give SoftBank control over infrastructure that is essential for training and deploying advanced AI systems. In addition, SoftBank is also in late-stage conversations to acquire DigitalBridge Group Inc., a U.S.-listed investment manager and one of Switch’s principal private equity sponsors, according to reports from last week.

Those close to Switch’s current ownership group are seeking an enterprise valuation of roughly $50 billion, including debt, should a sale proceed. At the same time, they are preparing for the possibility of launching an initial public offering as early as next year, an option that could deliver a valuation closer to $60 billion on a debt-inclusive basis. By comparison, Switch was taken private in 2022 through a deal involving DigitalBridge and IFM Investors Pty valued at around $11 billion including debt. Acquiring the company outright would instantly provide SoftBank with a broad footprint of data centers at a moment when global demand for AI-capable computing capacity is accelerating.

A separate transaction involving DigitalBridge—which manages approximately $108 billion in assets and specializes in digital infrastructure investments—would give SoftBank both fundraising expertise and deeper ties to investors focused on data center development. DigitalBridge’s stock has gained around 35 percent this year, bringing its market value to about $2.8 billion.

Although Mr. Son was an early advocate of artificial intelligence, SoftBank has not fully benefited from the market surge that elevated firms such as Nvidia, Taiwan Semiconductor Manufacturing Co., and OpenAI. Even so, the group has undertaken several significant AI-related initiatives this year. Among them is the massive “Stargate” program, created with partners including OpenAI, Oracle Corp., and Abu Dhabi’s MGX, which aims to develop large-scale data center infrastructure across the United States. Mr. Son committed an initial $100 billion to the project, though progress has been slower than expected. SoftBank has also made roughly $30 billion in funding available to OpenAI, purchased U.S. chip designer Ampere Computing LLC for $6.5 billion, offered to buy ABB Ltd.’s robotics business for roughly $5.4 billion, and acquired a stake in Intel Corp. To support these investments, the company has sold its entire Nvidia stake and increased a margin loan backed by shares of Arm Holdings Plc. Its domestic telecom arm has likewise expanded spending on Japanese data center capacity.

At present, none of the proposed transactions have reached a binding agreement, and there is no certainty that negotiations will result in completed deals. A purchase of Switch, if finalized, would rank among SoftBank’s most significant acquisitions and would likely require substantial outside financing. Representatives for SoftBank, Switch, and DigitalBridge have declined to comment on the ongoing talks. Investors have responded positively to SoftBank’s strategic shifts, with the company’s shares nearly doubling in value this year.