Tesla To Sell Stock Shares To Raise $500M

Tesla has filed to sell 2.1 million stock shares in order to raise about $500 million to expand its business.

If all of the underwriters exercise all of their options to purchase additional shares, Tesla could make as much as $566.5 million off the sale. That money will go towards Tesla expanding its charging network, growing its retail business, building the Gigafactory and development of the Model 3 sedan according to a filing with the Securities and Exchange Commission.

Elon Musk, Tesla’s CEO and current largest shareholder has already expressed interest in buying as many as 83,974 shares for a price of $20 million. Tesla stock currently sits around $242 a share, after sliding by 15 percent through Wednesday since July 20, the day after Tesla announced “Ludicrous Mode” for its Model S sedan which allows the car to sprint from 0 to 60 mph in just 2.8 seconds.

Elon Musk still plans on having Tesla profitable on a net basis by 2020, with a sales target of 500,000 units a year. Tesla is currently spending a “staggering amount of money on CapEx,” according to Elon Musk. Developing new models and increasing battery production by building a new factory will cost the company billions.

This article originally appeared at AutoGuide.com


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