Chinese internet giant Tencent Holdings Ltd. has bought a 5 percent stake in the U.S. electric vehicle maker Tesla, Inc. (NASDAQ: TSLA), a move that shows its confidence in Elon Musk and its ambitions in building electric vehicles.
Shenzhen-based Tencent purchased 8.17 million shares of Tesla during Tesla’s recent stock offering and through open-market acquisition of shares, according to a regulatory filing Tuesday. The purchase makes Tencent one of the largest shareholders in Tesla.
“Elon Musk is the archetype for entrepreneurship, combining vision, ambition, and execution,” Tencent said in an email. “Tesla is a global pioneer at the forefront of new technologies including electric vehicles, assisted driving, shared vehicles, digitizing real-world information, sustainable energy generation and scalable energy storage.”
Tesla shares jump as much as 2.30 percent to $276.43 in the early trading.
Earlier this month, Tesla has raised about $1.4 billion through stock offering and convertible debt to fund its production of Model 3 sedan.
Tencent, the owner of the WeChat messaging app, has been investing electric self-driving car aggressively. The company also invest in developing AI technology for driverless cars in the future.
"Tencent's success is partly due to our record of backing entrepreneurs with capital," the company said on Tuesday.