Meta Seeks to Raise 129 Trillion Won for AI Investment as Stock Offering Draws Orders for 5 Times the Shares on Offer
Meta has increased the amount of funding it plans to raise to expand investment in artificial intelligence (AI) infrastructure to about 129 trillion won. Investor interest has been strong, with orders for Meta's share offering reaching five times the number of shares on offer.
According to Bloomberg and other outlets on Oct. 27 (local time), Meta expanded the size of its Class A common stock offering to $25 billion (about 33 trillion won), from the originally planned $22.5 billion. As a result, its overall fundraising plan increased to $97.5 billion (about 129 trillion won), up from $95 billion.
The offering price for the common stock was set at $625 per share, about 2.7% below the closing price of $642 on Oct. 23. A total of 40 million shares will be issued. Meta also plans to issue 250 million depositary receipts based on convertible preferred stock at $50 each.
Orders for Meta's common stock offering reached about five times the number of shares on offer. More than half of the total offering was allocated to long-term investors and existing shareholders, while the 15 largest institutional investors were reported to have taken up about 70% of the total. The offering related to the convertible preferred stock also attracted orders several times greater than the number of shares on offer.
Major AI semiconductor companies also participated in the investment. Nvidia said it would invest $3 billion in Meta's share offering, while AMD said it would invest $1 billion. Nvidia CEO Jensen Huang said the company was working to optimize infrastructure across the board by expanding its collaboration with Meta.
Meta is seeking to raise substantial funds to expand its AI infrastructure and develop personal superintelligence. In addition to the offerings of common stock and convertible preferred stock, the fundraising plan includes selling up to $60 billion worth of newly introduced Class C non-voting shares in the market in the future.
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Meta's substantial AI investments are also increasing its financial burden. The company's free cash flow (FCF) posted a deficit of $2.12 billion in the third quarter of this year. Meta's move to raise funds by issuing shares is seen as a response to the financial pressure from expanding its AI investments.
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