Samsung Electronics Co has acquired shares in Chinese electric car maker for 3 billion yuan (US$499 million). Through its unit Shanghai Samsung Semiconductor, Samsung Electronics bought 52.3 million BYD shares at 57.4 yuan apiece via a private placement from six investors.

Samsung will own 1.92% of BYD, making it the second largest foreign share owner after Warren Buffet’s Berkshire Hathaway Energy stake in the car company. According to BYD, proceeds from the placement will be used to expand the company’s battery production and research into new-energy vehicles.

China targets the sale of electric vehicles to exceed 3 million units a year by 2025. China became the largest market for electric vehicles last year, surpassing the US.

Samsung has said that the cooperation can boost its automotive chip business. For now, BYD is the leading new energy vehicle maker, accounting for 30% of China’s new energy vehicle market. A few months ago, it signed a contract with the Canadian government to supply electric buses to at least one municipality. The company overtook Tesla as the biggest maker of new energy cars, according to BYD chief executive Li Ke.

China Merchants Bank was the lead underwriter and sponsor of the deal. Other joint sponsors include, UBS securities, Goldman Sachs Securities, CICC, and Guosen Securities.