An investor from one of Tesla’s fastest-growing markets just bought 5% of the electric-car maker.
Chinese social media giant Tencent paid $1.78 billion for the stake, a filing revealed Tuesday. The investment makes Tencent Tesla’s fifth-largest shareholder, behind founder Elon Musk and several investment firms, according to Reuters.
The new investment will help Tesla ramp up production of its mass-market Model 3, which is due out in 2018. Earlier this month, the company announced it would raise $1.15 billion through the sale of common shares and convertible debt. In the filing, Tencent said it bought its shares through the stock offering and on the open market.
It’s easy to see why Tesla is an attractive investment to Tencent, particularly as the Chinese company has expanded into transportation. Tesla’s sales in China tripled last year to $1.1 billion from $318 million in 2015. The region made up 15% of Tesla’s worldwide sales of $7 billion last year. The US, with $4.2 billion in sales, is still Tesla’s biggest market, though China grew at a faster clip.
It has also invested in ride-sharing company Didi Chuxing, which recently agreed to buy rival Uber’s China unit.