Tesla’s second stock offering netted the automaker $738 million in cash for its Gigafactory, Model 3 development, and dealer and service upgrades, Bloomberg is reporting.
Banks exercised their options to buy more stock than the initial $500 million estimate, with underwriters Morgan Stanley and Goldman Sachs buying more than 2 million of the available 3.1 million shares. Tesla CEO Elon Musk said he would be interested in buying $20 million worth of shares in the offering.
(Before the stock offering, the banking arms of Morgan Stanley and Goldman Sachs loaned Musk a combined $475 million, to which Musk pays market rate and is separate from their investment divisions, according to the offering.)
Shares of Tesla were down more than 3 percent in Thursday trading to $245.
The second offering is aimed at helping the company invest in capital projects that have sapped the company of cash. Its massive battery factory in Nevada, dubbed Gigafactory, and development costs for its lower-priced sedan, the Model 3, have cost the company money, Musk said.
After the company reported substantial losses in the second quarter of 2015, analysts calculated that Tesla lost around $4,000 on each car it sold.
Despite that, a Morgan Stanley analyst said Tesla stock could be massively undervalued, in part, because the company could develop an autonomous ride-sharing business with its electric cars.
Tesla is preparing to ship to dealers its Model X, which is the company’s third vehicle.
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