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UPDATE 1-Tesla Motors raises more than $1 billion from debt, equity

May 17 (IFR) – Tesla Motors has upsized its debt and equity offerings, as the electric car maker capitalizes on surging investor demand to raise more than $1 billion in cash.

The US company late Thursday increased the size of the convertible bond offering to $600 million, after increasing it earlier that day to $525 million from an initial $450 million.

Meanwhile on Friday Tesla finalized a per share price of $92.24 for the sale of 3.39 million common stock shares. It had originally planned to offer 2.7 million shares.

With overallotment options included on both offerings, total fundraising is $1.02 billion.

The move comes after Tesla, co-founded by Silicon Valley billionaire Elon Musk, last week reported an $11 million profit for the first quarter – the first profit in the company’s 10-year existence.

The success of the new fund-raising, and the company’s recent share price explosion, point to strong investor belief in Tesla’s long-term prospects.


The California-based company has been on a roll of late, with its new Model S car getting a near-perfect rating from the influential magazine Consumer Reports.

Tesla’s share price is up almost two-thirds since May 8, and some in the market believe that the company could be the next big thing when it comes to the still-young electric car sector.

“Either they become a niche manufacturer like Porsche or Maserati and make 50,000 high-end cars annually, or they crack the code on a $30,000 car that would put them on the inflection point of a large industrial,” one banker told IFR.

“Musk has a vision of creating a $50 billion-plus company in five years.”



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