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Filed under: and Tencent to Invest $1.55 Billion in Bitauto

Bitauto's sites provide information on new and used vehicles for Chinese car buyers.

Chinese auto information website operator Bitauto Holdings said and Tencent would invest about $1.3 billion in the company, sending its shares sharply higher in early trading on Friday.

E-commerce company and Tencent, best known for its communications app WeChat, will also invest a total of $250 million in Bitauto unit YiXin Capital.

“The three companies will work together to provide enhanced online automotive transaction services to car buyers across China,” Bitauto said.

The two companies will invest about $1.15 billion in new shares priced at $73.31 each. Each share represents one ADR., China’s No. 2 e-commerce company after Alibaba, will invest $400 million in cash and about $750 million in resources to Bitauto, whose sites offer sales data and other information on new and used vehicles as well as customer reviews. Tencent will pay $150 million for its shares.

Tencent and will buy YiXin Capital series A preferred shares for $150 million and $100 million respectively. and Tencent will hold 25 percent and 3.3 percent of Bitauto’s outstanding shares respectively after the deal closes in the first half of 2015. will also get one seat on Bitauto’s board.

The two companies will hold 17.7 percent and 26.6 percent of YiXin Capital respectively.

Bitauto’s shares were up 7.6 percent at $90.10 in early trading on the New York Stock Exchange. Shares of and Tencent were little changed.

(Reporting By Subrat Patnaik and Kshitiz Goliya in Bengaluru; Editing by Ted Kerr)

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