Tesla announces $500M common stock offering; growth of business, Model 3 and Gigafactory
13 August 2015
Tesla intends to offer, subject to market and other conditions, about $500 million worth of common stock (2.1 million shares) in an underwritten registered public offering. (As of 12 August, Tesla stock was trading at $238.17 per share.) Elon Musk, Tesla’s CEO, intends to purchase $20 million of common stock in this offering at the public offering price.
In addition, Tesla intends to grant the underwriters a 30-day option to purchase up to $75 million of additional shares of common stock. (Shares offered will rise to 2,415,000 if the underwriters exercise their option to purchase additional shares in full.)
Common stock outstanding after the offering will be 129,200,947 shares (or 129,515,947 shares if the underwriters exercise their option to purchase additional shares in full).
Tesla said it intends to use the net proceeds from this offering to accelerate the growth of its business in the United States and internationally, including the growth of its stores, service centers, Supercharger network and the Tesla Energy business, and for the development and production of Model 3, the development of the Tesla Gigafactory, and other general corporate purposes.
Goldman, Sachs & Co. and Morgan Stanley are acting as lead joint book-running managers for the offering, J.P. Morgan and Deutsche Bank Securities are acting as additional book-running managers for the offering, and BofA Merrill Lynch and Wells Fargo Securities are acting as co-managers.
An effective registration statement relating to the securities was filed with the Securities and Exchange Commission on 15 May 2013.
$500 million it around a quarter's cash burn.
Tesla had better hope Santa brings them something for Christmas
Many were expecting $2-3 billion equity to be offered.
Posted by: Davemart | 13 August 2015 at 08:36 AM
One can always use the GAAP method to ignore the profitability of the S which is having those profit put into plants and future production. $1B per year is nothing to sneeze at. If one is building a $5B plant over some period of time, $1B per year goes a long way.
Posted by: Brotherkenny4 | 13 August 2015 at 12:33 PM