The auction pipeline to build a new-car maker will include a deal to buy a large chunk of Tesla’s portfolio, the automaker announced Thursday.
Tesla CEO Elon Musk said Thursday he would sell up to 80 percent of his stake in the company, or about $5 billion, in the process.
The deal would be the first in a series of large purchases that could potentially give the company a market value that could surpass that of the other big automakers, such as General Motors Co., Ford Motor Co. and BMW.
The sale is the latest move to bolster Tesla’s stock as the automakers ramp up their own vehicle business.
The automaker said it will use the proceeds from the sale to pay dividends to shareholders.
The sale will allow Tesla to focus on the new-age business of selling and leasing cars, which are expected to be profitable in the long run.
Tesla’s stock is up more than 40 percent this year as the company continues to build out its production capacity and ramp up its autonomous vehicle efforts.
The automaker has a backlog of about 5 million vehicles and plans to make 500,000 this year, and expects to make another 1 million vehicles next year.
The company’s shares were trading near their record high on Friday.
Tesla has also entered into a new partnership with Japan’s Honda Motor Co., a deal that could see it acquire Honda’s vehicle business in 2018, which would make it a bigger player in the U.S. auto market than Ford.
Ford has been one of the big automakers that has been struggling to sell its own vehicles and get them to market.
The Tesla deal comes as Tesla continues to work on building its own autonomous vehicle unit.
Musk said at a Thursday morning investor conference that the company is aiming to have its own self-driving car on the road by 2021.