Tesla Raises $2 Billion in Surprise Stock Offering
Tesla prices a $2 billion secondary stock offering at $767 per share, reversing its earlier stance against raising capital. The automaker plans to use the funds to strengthen its balance sheet amid rising capital expenditure forecasts.
Tesla prices its secondary common stock offering at $767 per share, a 4.6% discount from Thursday's closing price of $804. The automaker sells 2.65 million shares to raise over $2 billion, with lead underwriters Goldman Sachs and Morgan Stanley holding an option to purchase an additional 397,500 shares. Despite opening lower on Friday, the stock quickly rebounds and hovers around the $802 mark.
This surprise offering directly contradicts statements made by CEO Elon Musk and CFO Zach Kirkhorn just two weeks ago during the company's fourth-quarter earnings call. At that time, Musk explicitly dismisses the idea of raising capital, stating the company spends money sensibly without holding back on expenditures. However, a 35% surge in share price since that late January call proves too tempting an opportunity for the company to ignore.
Top executives show their confidence by participating in the raise, with Musk purchasing up to $10 million in shares and board member Larry Ellison buying up to $1 million worth. Tesla plans to use the capital influx to strengthen its balance sheet and fund general corporate purposes, a move that aligns with a separate filing indicating capital expenditures could reach as high as $3.5 billion this year.