U.S. markets closed
  • S&P 500

    3,841.94
    +73.47 (+1.95%)
     
  • Dow 30

    31,496.30
    +572.16 (+1.85%)
     
  • Nasdaq

    12,920.15
    +196.68 (+1.55%)
     
  • Russell 2000

    2,192.21
    +45.29 (+2.11%)
     
  • Crude Oil

    66.28
    +2.45 (+3.84%)
     
  • Gold

    1,698.20
    -2.50 (-0.15%)
     
  • Silver

    25.30
    -0.17 (-0.65%)
     
  • EUR/USD

    1.1925
    -0.0054 (-0.45%)
     
  • 10-Yr Bond

    1.5540
    +0.0040 (+0.26%)
     
  • GBP/USD

    1.3827
    -0.0067 (-0.48%)
     
  • USD/JPY

    108.2450
    +0.2690 (+0.25%)
     
  • BTC-USD

    48,695.53
    +2,081.17 (+4.46%)
     
  • CMC Crypto 200

    982.93
    +39.75 (+4.21%)
     
  • FTSE 100

    6,630.52
    -20.36 (-0.31%)
     
  • Nikkei 225

    28,864.32
    -65.78 (-0.23%)
     

Warren Buffett-Backed BYD Raises $3.9B In Hong Kong

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
Mohit Manghnani
·2 min read
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

Chinese carmaker BYD Company (OTC: BYDDF) (OTC: BYDDY), backed by Berkshire Hathaway Inc (NYSE: BRK-A) (NYSE: BRK-B) Chairman Warren Buffett, raised $3.9 billion from a secondary stock sale in Hong Kong on Thursday, the Wall Street Journal reports.

What Happened: BYD makes electric cars, batteries, plug-in hybrids, and fossil-fuel-powered vehicles in China. The company cashed in on the investor bullishness in the EV space, which has seen its stock surge more than 400% in Hong Kong in the last 12 months.

BYD sold 133 million shares at HK$225 each, representing a discount of 7.8% to Wednesday’s closing price of HK$244, WSJ noted.

BYD becomes the latest Chinese EV maker to raise capital in a secondary listing after rival Xpeng Inc (NYSE: XPEV) raised $2.5 billion in December, followed by a $2 billion credit line to fuel expansion plans. Nio Inc (NYSE: NIO) had raised $3.1 billion in December, followed by $1.3 billion convertible notes last week

Why It Matters: The journal notes that investors in China bid up on car stocks searching for the next Tesla Inc (NYSE: TSLA). The capital raise puts BYD’s market capitalization at $91 billion, in line with rival Nio, compared to $806 billion for Tesla. 

Investors also hope that China’s pledge to become carbon neutral by 2060 and improvements in battery technology and infrastructure will increase electric vehicles’ wider adoption.

Based on last week’s report, BYD outdid rivals Nio and Xpeng in EV sales.

As per WSJ, a unit of Berkshire Hathaway has a stake in BYD since 2008 and holds 8.25% of BYD or 25% of its Hong Kong-listed stock. 

Click here to check out Benzinga’s EV Hub for the latest electric vehicles news.

Image Courtesy: Wikimedia

See more from Benzinga

© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.