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Electric automaker Tesla ( TSLA ) said late Wednesday that it will make a $2 billion secondary stock offering to fund its ambitious production schedule, sending its stock down in after-hours trading. “Because of the overwhelming demand that it has received for Model 3, Tesla intends to use the net proceeds from this offering to accelerate the ramp of Model 3,” said Tesla’s press release. “As noted in the company’s first-quarter shareholder letter , Tesla intends to start volume production and deliveries of Model 3 in late 2017 and to accelerate its 500,000 unit build plan from 2020 to 2018.” The company said $1.4 billion worth of stock will be sold by Tesla for this purpose. The remaining $600 million will be raised by CEO Elon Musk, who is exercising his option to acquire 5.5 million Tesla shares and will use the sale to cover his tax bill, the company said. He’s also donating 1.2 million shares to charity. Tesla stock was down more than 2% in after-hours trading Wednesday. In the regular session in the stock market today , Tesla rose 3.2% to close at 211.17, boosted by Goldman Sachs’ upgrade earlier in the day. Goldman upgraded the stock despite expressing deep skepticism about the 2018 production target, but the investment bank said the stock is attractively priced after falling 23% from early April through Tuesday. Scalper1 News
Scalper1 News