By Aya Wagatsuma

(Bloomberg) -- SoftBank Group Corp.'s stock fell by 12% on concerns that OpenAI may hold off on an initial public offering until next year and delay returns for its Japanese backer.

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SoftBank's investment in the ChatGPT maker is slated to stand at roughly $65 billion by October. Expectations of a big financial windfall from OpenAI's public debut had buoyed SoftBank shares to record highs, helping the company's market capitalization soar above Toyota Motor Corp.'s last month.

But bankers advising OpenAI cautioned that the volatility in tech stocks could dent enthusiasm for an offering, the New York Times reported. That sent shares of SoftBank into their biggest intraday decline in more than three months Friday morning in Tokyo.

A public listing of OpenAI's shares would provide a transparent market valuation for a big chunk of SoftBank's holdings, which includes hundreds of privately held startups, according to Hiroki Takei, a strategist at Resona Holdings.

If OpenAI were to go public, that would make it easier for investors to value SoftBank's overall portfolio, and the transparency could reduce the heavy conglomerate discount, or risk premium, applied to SoftBank shares.

"News of an IPO delay naturally dampens those expectations," he said.

The Sam Altman-led firm recently submitted paperwork for an IPO with the US Securities and Exchange Commission. OpenAI is working with Goldman Sachs Group Inc. and Morgan Stanley on a potential listing as soon as the fall, people familiar with the matter have said.

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