Tesla rolling out more stock to fund 'Model X'

May 26, 2011 | 08:46

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Tesla Motors announced plans on Wednesday to offer another 5.3 million shares in the US electric carmaker to the public to help fuel development of another model.

The Palo Alto, California-based Tesla, which was founded in 2003 by Elon Musk, a co-founder of PayPal and SpaceX, said it is also granting up to 795,000 shares of common stock to its underwriter at $26 a share.

In addition, Tesla said Musk, the company's chief executive, plans to buy 1.5 million shares directly from Tesla in a private placement and Blackstar Investco, an affiliate of Germany's Daimler, plans to purchase up to 644,475 shares.

Tesla hopes to raise $214 million from the various operations and plans to use the money to fund development of a Model X crossover vehicle.

In a filing with the US Securities and Exchange Commission (SEC), Tesla said it plans to produce a prototype of the Model X by the end of 2011 and to begin selling the vehicle in the fourth quarter of 2013.

Tesla said it is seeking with the Model X to "incorporate the functionality of a minivan with the consumer appeal of a sports utility vehicle."

Tesla's first car was the Tesla Roadster, a high-performance sports car.

The Tesla Roadster costs more than $100,000 and can go nearly 250 miles (400 kilometers) on a single charge.

In the SEC filing, Tesla said it had delivered around 1,650 Tesla Roadsters to customers in over 31 countries and would end production of the car in December.

Tesla is currently developing a four-door sedan known as Model S. The Model S, expected in 2012, has an anticipated base price of around $50,000.

Tesla conducted an initial public offering in June of last year, raising $226 million.

Tesla shares gained 8.46 per cent on Wall Street on Wednesday to close at $28.98.

AFP

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