Tesla seeks to raise about $500m through shares

The Pak Banker - - COMPANIES/BOSS -

YORK: Elec­tric-car maker Tesla Mo­tors Inc said it planned to raise about $500 mil­lion through the sale of 2.1 mil­lion shares. Chief Ex­ec­u­tive Elon Musk will buy nearly 84,000 shares for about $20 mil­lion in the of­fer­ing, the com­pany said on Thurs­day.

Tesla's shares were up 2.2 per­cent at $243.50 in pre­mar­ket trad­ing. Tesla said it as­sumed the shares would be sold at Wed­nes­day's clos­ing price of $238.17. Musk is al­ready the com­pany's largest share­holder with 22.25 per­cent stake. Tesla had 127.1 mil­lion shares out­stand­ing as of July 30.

The of­fer­ing comes a week af­ter Tesla re­ported a larger quar­terly loss and said it may raise more cash to off­set heavy spend­ing on in­creas­ing pro­duc­tion. Up to Wed­nes­day's close, Tesla's shares had fallen 12 per­cent since Aug. 5 when the com­pany re­ported its re­sults. The un­der­writ­ers have a 30-day op­tion to buy up to $75 mil­lion of ad­di­tional shares, Tesla said. The com­pany said it in­tended to use the pro­ceeds for de­vel­op­ment of its energy busi­ness, its up­com­ing Model 3 pro­ject, its bat­tery Gigafactory and other gen­eral pur­poses. Gold­man Sachs & Co and Mor­gan Stan­ley are lead joint book-run­ning man­agers for the of­fer­ing, while J.P. Mor­gan and Deutsche Bank Se­cu­ri­ties are ad­di­tional book-run­ning man­agers. BofA Mer­rill Lynch and Wells Fargo Se­cu­ri­ties are co-man­agers.

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