Tesla to sell $2 billion worth of common stock to power Model 3 production
Tesla Motors Inc. has filed to sell about $2 billion of common stock to grease its way to the Model 3, the $35,000 mass-market electric car it hopes to sell by late next year. The Silicon Valley electric-car maker said it will offer about $1.4 billion of shares, with the remaining shares to be sold by Chief Executive Elon Musk to cover tax obligations associated with his exercising of more than 5.5 million stock options, the company said in a press release. Net proceeds from the offering will "accelerate the ramp of Model 3," the company said. Musk's stock options, granted in 2009, are due to expire in December and, since Tesla shares have risen "considerably" in the intervening years, Musk will owe a "significant amount of taxes." Musk will also be donating 1.2 million shares to charity. The company didn't specify the charity recipients. Tesla shares fell 3.6% late Wednesday after ending the regular trading day up 3.2%. Morgan Stanley and Goldman Sachs are the offer's joint bookrunners. Goldman Sachs earlier Wednesday upgraded Tesla stock to buy.
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