Beijing-based artificial intelligence company Zhipu has raised approximately $5 billion through a dual-tranche Hong Kong share placement and zero-coupon convertible bond sale. The capital injection, announced on September 13, 2026, aims to fund next-generation GLM foundation models, massive computing infrastructure, and ongoing business expansion.
Artificial intelligence developer Zhipu has returned to the market for its largest capital raise of the year. Just eight months after going public on the Hong Kong Stock Exchange, the company completed a $5 billion financing round on September 13, 2026. This fresh funding arrives only two months after a previous placement in July that brought in approximately $4 billion, pushing the company’s cumulative capital raised from public markets past $10 billion across three offerings. Zhipu, formerly known as Zhipu AI, went public in Hong Kong in January.
Dual-Tranche Structure Combines Discounted Shares and Zero-Coupon Bonds
The financing was split into two independent tranches that did not depend on one another. For the equity portion, the company placed up to 21.965 million new H-shares at HK$714 per share to no fewer than six institutional investors. That placement price represented a 9.96 percent discount to the closing price of HK$793 on the trading day before the announcement, and a 19.95 percent discount to the five-day average price of HK$891.90. The placement shares represent approximately 4.50 percent of the enlarged issued share capital, with estimated net proceeds of approximately HK$15.664 billion (approximately $2.0 billion).
Concurrently, the firm issued zero-coupon convertible bonds due in September 2027 with an aggregate principal amount of RMB 20.14 billion (approximately $3.0 billion), which translates to approximately HK$23.55 billion. These yuan-denominated bonds will be settled in U.S. dollars. Issued at 100.5 percent of their face value and redeemable at par upon maturity, the bonds carry an initial conversion price of HK$892.50 per share, marking a 12.55 percent premium over the pre-announcement closing price and a 25 percent premium over the share placement price. Assuming full conversion, the bonds would convert into approximately 26.365 million new H-shares, representing approximately 5.36 percent of the enlarged issued share capital, with estimated net proceeds of approximately $3.011 billion.
Where the Capital Flows: Computing Power and Model Development
The company intends to allocate roughly 60 percent of the net proceeds directly toward research and development for next-generation GLM foundation models, a fully self-trained system, large-scale training and inference computing power deployment and upgrades, and long-horizon task reinforcement learning. An additional 15 percent is earmarked for business expansion, strategic investments, and potential mergers and acquisitions, while the remaining 25 percent will optimize capital structure, supplement working capital for daily operations, and serve other general corporate purposes.
the current supply and delivery conditions for high-quality computing resources in the market are relatively favorable, and computing resources require a certain lead time from contract signing to deployment and go-live. Completing the financing arrangement at this stage helps align the pace of new computing power deployment with the company's expansion plans.
Company filing, via Zhipu
Chinese artificial intelligence developers continue to seek massive capital infusions to build out the expensive infrastructure and recruit the talent necessary to compete with larger U.S. rivals. Zhipu expects all proceeds from this round to be fully utilized by June 30, 2028.
Shareholder Dilution and Long-Term Market Betting
The zero-coupon structure means bondholders receive no interest payments, betting instead on future equity appreciation. Under the terms of the filing, the company can redeem all, but not part, of the bonds from February 18, 2027 onward if its shares trade at or above 130 percent of the conversion price for 20 out of 30 trading days.
Following the new share placement and the potential full conversion of the convertible bonds, the single largest shareholder group—comprising Beijing Lianpai Technology Development Center and other concert parties—will see its stake gradually diluted from the current approximately 28.58 percent to 25.89 percent. Even with this dilution, the company’s public float will remain above 10 percent of the enlarged issued share capital, satisfying all Hong Kong Stock Exchange listing requirements.
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