On Tuesday, news surfaced China’s Tencent had spent $1.78bn buying a 5% stake in Tesla. Tencent bought around 8.2mn shares and is now the group’s 5th largest shareholder behind Elon Musk and investment companies Baillie Gifford, Fidelity and T. Rowe Price. The US electric car maker now has a deep-pocketed ally as it prepares to launch its mass-market Model 3. Tencent will act as both an investor as well as an advisor. Tesla stock traded sharply higher on the announcement, with the group closing in on Ford as the 2nd most valuable US automotive company behind General Motors.
Everyone knows Naspers is crazy expensive. But everyone keeps on buying it. And, for good or ill, I’m no exception.