Economy

Tesla plans to raise $2.3 billion new capital

Tesla said on Thursday it plans to raise more than $2 billion new capital, with $650 million of that coming from shares of common stock.

CEO Elon Musk will participate in the capital raise, purchasing 41,896 shares of the company’s stock, worth $10 million, in the new offering, according to a Securities and Exchange Commission filing. Tesla will also offer $1.35 billion of convertible notes, or $1.55 billion if underwriters exercise options to purchase additional notes in full.

Shares of the electric-car maker surged in pre-market trading.

Tesla hired Goldman Sachs, Citigroup, Bank of America Corp., Deutsche Bank, Morgan Stanley, Credit Suisse and Wells Fargo to underwrite the share offering.

In an SEC filing on Monday, Tesla said it could decide to explore alternative financing sources, despite generating enough cash to cover near-term obligations. The company estimated it had between $2.5 to $3 billion annually for the next two fiscal years, and expected that cash generated from its core operations would be sufficient to cover its future capital expenditures.

“As always, we continually evaluate our capital expenditure needs and may decide it is best to raise additional capital to fund the rapid growth of our business,” the documents said.

Three days later, Tesla said in a new SEC filing that it planned to raise $2.3 billion by selling common stock and debt securities.

This is a developing story.

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