China's Tencent Holdings acquires 5% in US electric car maker Tesla for $1.78 bn
29 March 2017
Chinese internet company Tencent Holdings Ltd has acquired a 5-per cent stake in US electric car maker Tesla Inc for $1.78 billion.
Tencent, one of Asia's largest tech companies, acquired about 8.17 million shares in Tesla. It is now the fifth-largest shareholder, behind Tesla CEO Elon Musk and investment companies Fidelity, Baillie Gifford and T Rowe Price.
The investment comes days after Tesla raised roughly $1.25 billion by selling new stock and convertible securities to help fund Model 3 production.
Last year Elon Musk told investors and over 370,000 customers who put deposits down for a Model 3 that he intended to start building the cars in July 2017.
At the time, many analysts and suppliers said the timeline was too ambitious and would be difficult to achieve, pointing to Tesla's history of missing aggressive production targets.
Musk also told that the company could miss the July 2017 startup target if suppliers do not meet deadlines.
To enable Tesla's batteries store power from solar panels, Tesla last year acquired roof top solar panels manufacturer SolarCity Corp for $2.8 billion.
Founded in 1998 by Ma Huateng, Tencent is best known for its WeChat mobile messaging app.
Tencent, which was an early investor in Shanghai-based electric vehicle startup Nio, has a market cap of $275 billion, while Tesla has a market value of $45 billion.