Tencent, the Chinese technology giant, is reported to have bought a 5% share in electric automaker Tesla.
Chinese Firm Tencent buys 5% Tesla Stake for $1.78bn
Tencent has spent a whopping $1.78bn in its foray into the electric car market with its flagship stake in US based Tesla.
Best known for its mobile app, WeChat, Tencent has recently expanded its portfolio to invest in diverse sectors including entertainment, gaming, cloud computing and online financing as well.
According to Tesla, the stake bought by Tencent is only passive so the technology company would have no input in the running of Tesla.
Tesla shares climbed 2.3% following the announcement.
The automaker’s electric cars include the Roadster, the fastest electric sports car, and the Model S.
The company is also in the business of battery storage and the manufacture of residential solar panels through its subsidiary, SolarCity.
The electric carmaker is set to launch its Model 3 sedan for the mass market and has raised an estimated $1.2bn in share and bond sales so far.
Tencent is one of the largest tech companies in Asia and has in the past supported companies manufacturing electric vehicles.
It was among the initial companies to invest in NextEV, a startup based in Shanghai with offices in San Jose California.
NextEV has since rebranded itself into Nio.
Following its purchase of the 5% stake, Tencent becomes the fifth largest shareholder in Tesla rivaled only by chief executive Elon Musk with a 21% stake, followed by investment companies Fidelity, Baillie Gifford and T Rowe Price.
On Tuesday, Mr. Musk confirmed in a tweet that he had launched a startup Neuralink, whose goal is to create technology that connects human brain to computers.
He added that the company was still in its very early stages and would operate as a medical research company.
Neuralink will develop a neural lace technology that would aid in implanting small electrodes in the brain with the aim of giving humans additional artificial intelligence and improve memory.
Reports by the Wall Street Journal, which first announced the news, say Mr. Musk is privately funding the company and top academics have been contracted to work for the firm.
Those in this field anticipate a time when technology would enable humans to upload and download thoughts onto a computer.
As one of the most visionary leaders in Silicon Valley, Mr. Musk’s other ventures include the Space X company dedicated to space exploration, a company exploring the possibility of digging tunnels underneath Los Angeles and yet another company to power Australia, all in addition to his flagship Tesla.