Tesla Inc is making the most of its bragging rights as the most important electric car manufacturer in the globe, with a stock offering to boost its portfolio as the group builds more assembly lines and cements its status as the world's dominant EV company.
Tesla on Tuesday disclosed in a Securities and Exchange Commission filing that it will unload up to $5 billion in fresh shares, gradually selling these "at-the-market" prices. The company said its lenders will dispose of the shares based on directives from its board. The banks include Bank of America Securities, Goldman Sachs, Citigroup Global, Capital Inc, and Morgan Stanley.
The decision comes just a day after the company initiated a 5-for-1 stock split, its first since the company went public in June 2010. The move also comes on the heels of a 450 percent rise in its share price this year.
Tuesday's share sale announcement comes as the California-based group seeks to aggressively hike the output of its current lineup of vehicles and establish new facilities in Germany and Texas. Also in the pipeline are new vehicle designs, including a semi-truck dubbed Tesla Semi and the advanced Cybertruck.
Tesla did not provide specifics for the fresh capital infusion. Instead, it stated that it plans to use the money to further boost its financial statement and "general corporate purposes." The company had roughly $8.6 billion of cash and related assets as of June 30. Wedbush financial strategist Daniel Ives called Tesla's potential share to offload a wise decision.
Tesla secured over $2 billion from a stock divestment in February to strengthen its ledgers. The capital helped the company fund the construction of its mega-factory in China as Tesla expects to make profits in building its Model 3 EV.
Tesla's market cap is currently pegged at approximately $464 billion, which suggests the new share sale comprises around 1 percent of its aggregate market value, data by FactSet showed.
