And now indeed it seems that logic might be coming to fruition, as Tesla has filed with the SEC (Security and Exchange Commision) on March 15 to sell almost 1 million shares worth at least $250 million and at least $750 million of convertible notes (options) due in 2022. Underwriters still have options to purchase another 200,000 shares on top of that if investor demand is there.
The iconic electric car-maker has revealed that it's discontinuing the Model S that comes with a 60 kilowatt-hour battery, in other words its cheapest vehicle now available.
Goldman, Sachs & Co., Deutsche Bank Securities, Citigroup and Morgan Stanley are acting as lead joint book-running managers for the offering, with Barclays, BofA Merrill Lynch and Credit Suisse acting as additional book-running managers.
Tesla raised about $1.2 billion in fresh capital through a sale of stock and issuance of new debt Thursday as the company readies for production of its first mass-market electric vehicle.
Already we've seen Tesla testing its new Model 3 on public roads.
Some Wall Street analysts had predicted that Tesla would seek to raise as much as $2.5 billion in capital.
"This is really a question of what's the risk tolerance of the company, or how close to the edge do we want to go", Musk said.
The company is offering Dollars 250 million of common stock and USD 750 million of convertible senior notes due in 2022. To raise the US$1.15 billion ahead of the launch of the company's Model 3 electric vehicle, the company plans to offer its investors US$250 million of common stock. Musk reportedly said that advanced analytical techniques are allowing the company to skip the usual beta phase. With production potentially starting in a few months, and ramping up later this year, Tesla may be looking to better distinguish the two in terms of pricing and range.