Tesla Inc Shares Jump As Tencent Takes 5% Stake In Company

From StockNews.com: Tesla Inc (NASDAQ:TSLA) saw its stock rise up to 3% on Tuesday morning, after news broke that a mega cap Chinese company has taken a significant stake in the electric vehicle and energy giant.

Tencent Holdings Ltd, perhaps best known as the parent company of messaging app WeChat, has purchased a 5% stake in Tesla. The news was uncovered via recent regulatory filing with the Securities and Exchange Commission (SEC).

Tencent paid about $1.8 billion for the stake, according to documents, and completed the purchase via an offering in March as well as on the open market. The Shenzhen-based company noted that its stake in TSLA is “passive,” meaning it won’t try to flex its muscles to push Tesla in any particular direction, nor will it seek a seat on its board.

The move could, however, open up Tesla’s foray into potentially lucrative Chinese markets. Electric vehicles are almost nonexistent in China, but with major pollution problems and a rapidly growing middle class, the country may represent a major growth market for Tesla in coming years.

Tesla has yet to officially comment on the news.

Tesla Inc shares rose $8.04 (+2.98%) in premarket trading Tuesday. Year-to-date, TSLA has gained 26.45%, versus a 4.51% rise in the benchmark S&P 500 index during the same period.

TSLA currently has a StockNews.com POWR Rating of A (Strong Buy), and is ranked #2 of 24 stocks in the Auto & Vehicle Manufacturers category.

Tesla Inc (NASDAQ:TSLA) rose $5.77 (+2.14%) in premarket trading Tuesday. Year-to-date, TSLA has gained 26.45%, versus a 4.51% rise in the benchmark S&P 500 index during the same period.


This article is brought to you courtesy of StockNews.com.

You are viewing an abbreviated republication of ETF Daily News content. You can find full ETF Daily News articles on (www.etfdailynews.com)

Powered by WPeMatico