WASHINGTON, May 16, 2013 – Tesla CEO Elon Musk is putting Tesla’s financial house in order. He is saying goodbye to Uncle Sam and hello to Wall Street. Yes, the times are changing. The electric car revolution is rocketing and rolling from Main Street to Wall Street. Certainly, Mr. Musk has silenced a number of critics and sent a number of shorts running for cover. And, beyond the headlines, he has inspired many, young and old, to dream of better days for the nation, an electric revolution. We are lucky to have him.
Yesterday, after market hours, Tesla announced plans to raise capital through stock and convertible notes, stating that the primary purpose of the offerings is to pay back the government loan. As part of this overall deal, Mr. Musk plans to personally invest 100 million, which gives the capital raising a boost of confidence. The press release stated: “The aggregate gross proceeds of the offerings, including the options granted to the underwriters, and the private placement is expected to be approximately $830 million.”
The timing for the capital raising is great. The stock market is running hot, and Tesla’s stock is running spicy hot. In today’s trading of Tesla’s shares (TSLA), the stock market showed its approval. The shares closed up 8.7% to $92.25 per share on big volume of 21.4 million shares traded.
An analyst on the Q1 conference call had questioned Mr. Musk if he might consider raising funds. In response, Mr. Musk said that management had not been talking about the subject. Obviously, management started doing some talking. Overall, Mr. Musk is very goal oriented with long and short-term development plans. However, he will alter course to be opportunistic, as many technology leaders do.
What’s next? Mr. Musk still has a big Supercharger announcement to come next week. He tweeted on May 14: “Supercharger announcement pushed to next week. Something else this week.” So, we still have time to mull over the future of the Supercharger.
As you recall, on May 9, Mr. Musk tweeted: “There is a way for the Tesla Model S to be recharged throughout the country faster than you could fill a gas tank.”
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