Zhipu AI to Raise $5 Billion Through Share Placement and Convertible Bonds

Huo Xing Cai Jing reports, according to Reuters, that AI company Zhipu has launched a Hong Kong stock placement of approximately $2 billion and a convertible bond issuance of approximately $3 billion, totaling around $5 billion in fundraising. Zhipu will issue 21.97 million new shares at a placement price of HK$714 per share, representing a discount of approximately 10% compared to the closing price of HK$793; simultaneously, it will issue RMB 20.14 billion (approximately $3 billion) in zero-coupon convertible bonds maturing in September 2027. The convertible bonds will be issued at 100% to 100.5% of par value, yielding -0.5% to 0%, with an initial conversion price of HK$892.5, a 25% premium over the placement price. The proceeds will primarily be used for research and development, computing resources, and related infrastructure, as well as for business expansion, strategic investments, potential acquisitions, working capital, and other corporate purposes. The stock placement and convertible bond issuance are being conducted concurrently, but the settlements of the two transactions are not mutually dependent.