China’s AI Chipmaker Biren Sees Shares Sink 12% Over $510 Million Stock Sale Plan

This Biren share placement is the firm’s second since its January Hong Kong listing, following an earlier round completed in July.

Stock Takes a Hard Hit on Fundraising News

Shares of Shanghai Biren Technology, a Chinese AI chip developer, dropped more than 12 per cent in Hong Kong trading on Thursday. The slide came right after the company announced a fresh Biren share placement worth HK$4 billion, or roughly US$510 million. Competition among Chinese firms building alternatives to Nvidia chips keeps getting fiercer.

Details of the Share Placement

The sell off began soon after an exchange filing surfaced late Wednesday. Biren revealed it had hired placing agents to sell new stock on a “best effort” basis. The plan involves issuing 130 million new shares priced at HK$31.08 each.

That price sits close to 10 per cent below Wednesday’s closing price of HK$34.44. Once this Biren share placement wraps up, the fresh shares would equal nearly 5 per cent of the company’s total issued shares.

Shares Slide Sharply During Thursday Trading

Biren’s stock sank as low as HK$30.24 during the session. It eventually closed 11.9 per cent lower at HK$30.36, wiping out a chunk of recent gains for the Chinese AI chipmaker.

Second Capital Raise This Year

This fundraising push marks Biren’s second share placement since its Hong Kong debut in January. An earlier capital raise had already taken place back in July. Biren continues pouring money into developing its AI processors and related technology, even as this new capital gets channelled into further expansion.