Tesla Raises Capital With Stock Offering | Edmunds.com
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Tesla Raises Capital With Stock Offering


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Just the Facts:
  • Tesla Motors said it will raise capital with offerings of 2.7 million shares of common stock and $450 million in convertible senior notes, as it seeks to repay its U.S. Energy Department loan ahead of time.
  • Tesla said in a statement that CEO Elon Musk will buy $45 million worth of shares in the public offering and another $55 million in a private placement due to regulatory requirements.
  • Tesla stock opened at $95.00 a share on Thursday.

PALO ALTO, California — Tesla Motors late Wednesday said it will raise capital with offerings of 2.7 million shares of common stock and $450 million in convertible senior notes, as it seeks to repay its U.S. Energy Department loan ahead of a five-year schedule.

Tesla said in a statement that CEO Elon Musk will buy $45 million worth of shares in the public offering and another $55 million in a private placement due to regulatory requirements.

Tesla stock opened at $95.00 a share on Thursday.

The total proceeds from the offerings, including options granted to the underwriters and the private placement, is expected to be approximately $830 million, the company said.

"Tesla intends to use the net proceeds from the offerings to prepay Tesla's outstanding loan from the United States Department of Energy, pay the cost of convertible note hedge transactions and for general corporate purposes," the company said.

Tesla's original credit line from the federal government was $465 million.

The announcement comes after Tesla reported its first quarterly profit last week, pushing its shares to record highs.

"If anyone has the Midas Touch in Silicon Valley, it's Elon Musk," wrote the Silicon Valley Business Journal on Wednesday, saying that Musk had been spreading the automotive equivalent of "fairy dust."

Earlier this week, Musk tweeted that the company's latest Supercharger announcement has been pushed to next week.

Edmunds says: Although Tesla has yet to say exactly how much faster it would pay back the government loan, it clearly has made that goal a priority.

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