Alibaba’s $12 Billion Share Sale to Fund AI Push Sends Stock Lower

Alibaba Group Holding Ltd. said it will raise about 80 billion yuan ($12 billion) in a share placement to finance its artificial intelligence expansion, sending its Hong Kong-listed stock down 8.5% as investors weighed the cost of its push into AI.

The company plans to sell 710 million new shares to investors outside the U.S. at HK$112.7 ($14.4) apiece, an 8.4% discount to the stock’s Aug. 21 close. Alibaba said net proceeds of HK$79.7 billion will be used in full to build out its full-stack AI capabilities and related infrastructure.