Profile image
By ETF Daily News (Reporter)
Contributor profile | More stories
Story Views

Last Hour:
Last 24 Hours:

Tesla Will Raise Over $1 Billion To Address Capital Concerns

Thursday, March 16, 2017 7:25
% of readers think this story is Fact. Add your two cents.

From Tesla Inc (NASDAQ:TSLA) is seeking to significantly boost its capital reserves by selling a combination of stock and convertible notes, as it looks to mitigate rising risks associated with its Model 3 auto production.

The company announced via press release that it’s issuing $250 million worth of common stock and $750 million in convertible senior notes due in 2022. Underwriters are being given the option to buy an additional 15% of each offering, so the total value of the capital raise will be well over $1 billion.

Tesla commented via press release:

The aggregate gross proceeds of the offerings, including the options granted to the underwriters, is expected to be approximately $1.15 billion. Tesla intends to use the net proceeds from the offerings to strengthen its balance sheet and further reduce any risks associated with the rapid scaling of its business due to the launch of Model 3, as well as for general corporate purposes.

TechCrunch has some additional detail on the move, which was widely expected, along with the aforementioned production issues:

Tesla’s decision to pad out its balance sheet with more capital was anticipated by many analysts, and a fair number of Wall Street watchers actually thought Tesla would seek more to help it grow based on recent comments made by Tesla CEO Elon Musk.

The Model 3 is set to begin full production this year, with pre-production begun in February with a temporary production line pause to help get processes ready at its Fremont factory ready for the new vehicle.

The last time Tesla announced a stock offering was back in May 2016, when it raised $1.4 billion. It used those proceeds to significantly ramp up the production of its vehicles.

Tesla Inc shares rose $8.12 (+3.18%) in premarket trading Thursday. Year-to-date, TSLA has gained 23.21%, versus a 6.97% rise in the benchmark S&P 500 index during the same period.

TSLA currently has a POWR Rating of B (Buy), and is ranked #11 of 24 stocks in the Auto & Vehicle Manufacturers category.

Tesla Inc (NASDAQ:TSLA) was trading at $260.63 per share on Thursday morning, up $4.9 (+1.92%). Year-to-date, TSLA has gained 21.97%, versus a 6.97% rise in the benchmark S&P 500 index during the same period.

This article is brought to you courtesy of

You are viewing an abbreviated republication of ETF Daily News content. You can find full ETF Daily News articles on (


We encourage you to Share our Reports, Analyses, Breaking News and Videos. Simply Click your Favorite Social Media Button and Share.

Report abuse


Your Comments
Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

Top Stories
Recent Stories



Top Global


Top Alternative




Email this story
Email this story

If you really want to ban this commenter, please write down the reason:

If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.