Shares of the Chinese artificial intelligence firm Z.ai experienced a decline of over 10% on Monday following the announcement of plans to secure approximately $5 billion through a combination of a new share issuance and convertible bond offering. This fundraising initiative marks the company’s second significant capital raise within the span of just two months.
Based in Beijing, Z.ai intends to issue up to 21.97 million new shares priced at HK$714 each, which would generate about HK$15.68 billion (around $2 billion) in total revenue. This placement price reflects a 10% reduction compared to Z.ai's closing price of HK$793 from the previous Friday.
In addition, the company is set to issue zero-coupon convertible bonds worth 20.14 billion yuan (approximately $3 billion), which will mature in 2027. These bonds will have a conversion price of HK$892.50 per share, representing a 12.5% premium over Friday’s closing figure.
Z.ai indicated that the funds raised will be allocated towards advancing its next-generation AI models, with investments in research and development, training and inference systems, as well as commercialization efforts.
This latest fundraising round follows closely on the heels of a significant capital increase in July, where Z.ai successfully raised around $4 billion through a previous share placement.
The company’s shares had recently surged when it revealed a new AI model designed to operate completely on chips produced in China, utilizing 100,000 domestically manufactured chips for processing online requests.
Meanwhile, Z.ai's domestic competitor, MiniMax, also saw its stock decline, dropping by approximately 5% on the same day.



