SFBT file photo / Paolo VesciaElon Musk will buy 1.5 million shares of Tesla Motors Inc.’s common stock. They are worth about $40 million.
Elon Musk will buy 1.5 million shares of Tesla Motors Inc.’s common stock in a private placement, part of a larger, $158 million offering.
At about $26 per share -- Tesla’s proposed maximum price -- Musk will be putting about $40 million into the company.
The Palo Alto electric car maker (NASDAQ: TSLA) is selling the shares to its CEO alongside a follow on offering of 5.3 million shares. It needs to raise money because, although it has gotten some big loan guarantees from the U.S. government to pay for a factory in Fremont at the former NUMMI plant, Tesla has never yet made a profit.
Blackstar Investco LLC, an affiliate of German carmaker Daimler AG, will also buy 644,475 shares for about $17 million. Tesla sells electric powertrain gear to Daimler and plans in future to sell components to Toyota (NYSE: TM).
The offering itself could raise $158.5 million in total.
Tesla is selling the shares itself, with Goldman, Sachs & Co. underwriting the offering. Goldman got a 30-day option to buy 795,000 more shares.
The company will spend this money on its “Model X” SUV.
As of March 31, Tesla had accumulated a deficit of $463.9 million. It has lost money every year of its existence — $82.8 million in 2008, $55.7 million in 2009, and $154.3 million in 2010. In the first quarter of 2011, it lost $48.9 million.
Tesla is one of the most shorted stocks on the nasdaq...
Tesla Shows How To Run A Secondary Offering, With Insider Buying (TSLA)
Posted: May 25, 2011 at 11:39 am
Tesla Motors, Inc. (NASDAQ: TSLA) is bucking a trend. The company has just announced a follow-on offering of 5.3 million shares of common stock. Amazingly, the shares rallied on the news because of an insider purchase of shares. What appears to be helping shares today is that all of the shares being sold are being sold by the company. This is no insider cash-out stock sale. In fact, CEO and co-founder Elon Musk is buying shares concurrently.
The report noted that Elon Musk will purchase 1,500,000 shares of common stock directly from Tesla at the public offering price. On top of that, Daimler AG’s Blackstar Investco unit will purchase “up to approximately 644,475 shares” directly from Tesla at the public offering price.
What is interesting is that the only underwriter is Goldman Sachs. The company said that it intends to use a portion of the net proceeds to fund the development of its Model X crossover vehicle.
Shares of secondary offerings usually tank a stock. When a CEO and a key business partner announce that they are also buying direct stock to increase ownership, that often changes the game. Tesla shares are up 4.6% at $27.95 on more than 2 million shares after about two hours of trading.
JON C. OGG
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Read more: Alternative Energy, Autos, Insider Activity, Secondary Offering, Elon Musk, Tesla Model X, Tesla secondary offering, TSLAPopular:
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Wed May 25, 2011 12:10pm EDT
* Company plans public offering, private placement
* Will use proceeds to develop Model X crossover vehicle
* Tesla shares rise 5.8 percent
DETROIT, May 25 (Reuters) - Electric car maker Tesla Motors Inc (TSLA.O) plans to raise up to $214 million through a secondary public offering of its shares and a private placement.
Tesla shares rose 5.8 percent to $28.27 in midday trading on Nasdaq.
In a regulatory filing on Wednesday, Tesla said it planned to raise up to $158.5 million through a public offering of 6.095 million of its common shares, including 795,000 shares granted to the underwriter in a 30-day option, at $26 a share.
In the private placement at the same price, Tesla said it would sell 1.5 million shares to Chief Executive Elon Musk and 644,475 shares to Blackstar Investco LLC, an affiliate of Daimler AG (DAIGn.DE).
At the offer price, the private placement would raise $55.8 million.
Tesla said it plans to use some of the proceeds of the offering and the private placement to fund the development of its Model X crossover vehicle.
Goldman Sachs (GS.N) is acting as sole book-running manager for the public offering. (Reporting by Mike Miller. Editing by Robert MacMillan)
May 24 (Bloomberg) -- Elon Musk, chief executive officer of Tesla Motors Inc. and Space Exploration Technologies Corp., talks about production of Tesla's battery-powered Model S sedan. Musk also discusses Tesla's shares and prospects for SpaceX. He speaks with Cory Johnson and Emily Chang on Bloomberg Television's "Bloomberg West." (Source: Bloomberg)
Tesla Motors Inc. (TSLA) Chief Executive Officer Elon Musk said he expects the maker of electric Roadster sports cars to remain independent and isn’t planning to sell his stake in the company.
“I don’t think it’s a good idea to plan to sell a company,” Musk said today in an interview with “Bloomberg West.” “I don’t personally have any interest in selling. I think there’s a lot of innovation we can bring to the car business.”
Tesla, named for inventor Nikola Tesla, has said it will likely continue to post losses for at least another year as it prepares to build and deliver Model S electric sedans starting in mid-2012. Speculation that the Palo Alto, California-based startup may eventually be acquired by a larger company has persisted this year.
The company reported a first-quarter net loss on May 4 that was narrower than analysts estimated as it boosted revenue from battery packs and development work with partners Daimler AG (DAI) and Toyota Motor Corp. (7203) Sales more than doubled to $49 million.
“With partners like that, it’s very feasible to stay independent for a long time,” said Musk, who owns about 27 percent of the company, according to Bloomberg data.
Tesla fell 10 cents to close at $26.72 at 5:20 p.m. New York time in Nasdaq Stock Market trading. The shares are little changed this year.
To contact the reporters on this story: Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net; Emily Chang in San Francisco at echang68@bloomberg.net
To contact the editor responsible for this story: Kae Inoue at kinoue@bloomberg.net
Sent from my iPhone (typos included)
