(July 10): MiniMax Group Inc is joining a rush by Chinese technology companies to tap markets for funding aimed at the artificial intelligence (AI) buildout, looking to raise as much as US$2 billion from selling new shares and convertible bonds.
The company is seeking HK$9.5 billion from a sale of 35.6 million shares at a fixed price of HK$268 each. The pricing represents about a 9.9% discount to the closing price of HK$297.4 on Thursday in Hong Kong. The company’s shares fell as much as 9.8% on Friday. Concurrently, MiniMax is offering HK$6.5 billion of zero-coupon convertible bonds due in 2027, according to terms seen by Bloomberg. The bonds are offered with a 25% conversion premium, and are expected to price July 10, the terms show.
China’s tech stars are rolling out a wave of deals to take advantage of still strong investor interest for the industry and raise funds to ramp up production. AI model maker Zhipu this week raised US$4 billion in a share sale, the second-biggest equity offering in Hong Kong this year. Shanghai Biren Technology Co launched a US$901 million share placement a week ago, while memory giant CXMT Corp announced plans to open investor subscriptions next week for a US$4.3 billion offering, China’s largest in four years.
MiniMax, which competes with Zhipu, has dropped 78% from a March peak, mainly due to increasing concerns about the competitiveness of its AI models. The company cut the price of its most advanced model by half in June, just a week after its launch, sparking concerns over the lack of pricing power.
The additional shares to be offered will further boost the supply of shares in the public float, after the company this week unlocked a chunk of shares held by its pre-IPO investors, following a six-month restriction period. Goldman Sachs Group Inc on Friday turned more positive on the stock, saying the valuations looks attractive and its model has good cost efficiency.
See also: The China-Davos challenge
Uploaded by Felyx Teoh
