After a somewhat disappointing IPO in New York last month, Chinese electric car manufacturer Nio (NIO) has gotten a jump-start. A Tuesday filing revealed that one of Tesla’s biggest investors has made a big bet on it.
On Nio’s first day on the NYSE, September 12, the stock closed a little lower than it was initially priced. After peaking the next day with 75% gains, the car-maker’s stock shifted into neutral and gradually rolled downhill before finding a parking spot below it’s original closing price, at about $6.20.
Now, just hours after the new disclosure, and hours after market close, the stock price is feeling out a new support level which may keep it over $7.80, which would be up 25% from it’s recent moving average. At the time of this writing, the high water mark for Tuesday after hours is $8.35.
The IPO took place in the midst of trade tensions between the US and China, with a new version of NAFTA about to be signed that will implement protections for North American automakers.
One of Nio’s original investors in China was Tencent Holdings (TCEHY), the world’s largest social networking and streaming company. The New York IPO for NIO was set to raise $1.8 billion, but fell significantly short of that, raising just $1 billion.
The investor that created the spark was Baillie Gifford & Co, which owns a 9% stake in Tesla (TSLA) and manages mutual funds (BGAKX, BGITX). A regulatory disclosure Tuesday revealed that Baillie Gifford has purchased an 11.4% stake in NIO, which is 85.3 million shares, worth approximately $515 million at the time of the filing.