Tencent tells bond investors its roughly $5bn offering is meant to fund AI spending, mostly on chips, Bloomberg reports

Tencent told fixed-income investors on Monday 12 October that its planned bond offering of about US$5bn is meant to fund AI-related spending, Bloomberg reports, carried by The Edge Malaysia. It cites people familiar with the matter, who say Tencent's management described the bulk of that spending as chip purchases.

The offering includes US$1.5bn to US$2bn across dollar tranches and 20bn to 25bn yuan of offshore yuan notes, and could price as early as Tuesday, the report says. Tencent currently has no plans to issue shares or convertible bonds. Tencent did not respond to a request for comment.

The report comes on the same day that the chief executives of Intel and Broadcom said capital, not chips, may be AI's biggest constraint. A big technology group raising debt to buy AI chips is one form of the borrowing the IMF's Kristalina Georgieva warned about on 8 October, in a story the Switchboard ran.

No Hong Kong exchange announcement for this deal was visible from here, and Tencent's own figures for its AI spending were not checked in this run, so none are given. The pricing, if it happens, is the next thing to check.

• Reported Tencent told fixed-income investors its planned bond of about US$5bn is meant to fund AI-related spending, people familiar with the matter said. Bloomberg, via The Edge Malaysia
• Reported The offering includes US$1.5bn to US$2bn in dollar tranches and 20bn to 25bn yuan of offshore notes, and could price as early as Tuesday. Bloomberg, via The Edge Malaysia
• Reported Tencent has no current plans to issue shares or convertible bonds, and did not respond to a request for comment. Bloomberg, via The Edge Malaysia