Z.AI, First Listed LLM Developer, to Raise $5B in Capital

Z.AI, the world's first large language model developer to go public, announced on Sept. 13 plans to raise about $5 billion through a private placement of new shares and issuance of convertible bonds. Shares in the Hong Kong-listed company fell 9.1 percent to close at HK$721 (US$91.92) after the announcement.

The Beijing-based company will issue 21.97 million new shares to at least six investors at HK$714 each, a discount of about 10 percent from its Sept. 11 closing price, raising about HK$15.7 billion (US$2 billion). The new shares will represent about 4.5 percent of its enlarged share capital. In addition, Z.AI will issue about CNY20.1 billion (US$3 billion) of zero-coupon convertible bonds, with an initial conversion price of HK$892.50 per share, a premium of about 12.6 percent. The placement is expected to close on Sept. 16, 2026, and the bonds mature on Sept. 16, 2027.

The company said it has exhausted proceeds from its IPO and used nearly 35 percent of funds from its first private placement, as spending on frontier AI development has risen faster than expected. About 60 percent of net proceeds will fund R&D for next-generation general language models, fully self-training capabilities, large-scale model training, production inference systems, and computing infrastructure. Around 15 percent will support business expansion, strategic investments, and potential acquisitions, with the remaining 25 percent for balance-sheet optimization and working capital.