Sign in to follow this  
NINETY EIGHT REGENCY

Tesla stock to hit market today

1 post in this topic

Tesla stock to hit market today

Automaker increases shares being offered

BY MATT ANDREJCZAK

MARKETWATCH

SAN FRANCISCO -- As Tesla Motors, the Silicon Valley-based maker of sleek, high-performance electric cars, steers its highly anticipated public stock offering toward a debut today, hopes are running high that the company can plug into a rich vein of ready cash stretching from the Bay Area all the way to Wall Street.

Tesla, whose top-end Roadster model sells for more than $100,000, was founded in 2003 by CEO Elon Musk and Chief Technical Officer J.B. Straubel. It has yet to turn a profit.

Nonetheless, the stock is likely to attract a cult following, said Scott Sweet, senior managing partner of IPO Boutique.

At a time when General Motors is also gearing up for a return to the public markets, the unconventional Tesla is becoming the first American car maker to go public since Ford first brought its shares to the New York Stock Exchange in 1956. Tesla is focusing on its clean-energy technology as a selling point for its company, hoping to tap into growing consumer interest for hybrid vehicles in an era of higher oil prices.

And Sweet said there is, in fact, strong demand for Tesla shares. He said the Tesla IPO is "multiple times oversubscribed" at the retail and institutional levels, which suggests the deal could be priced at the high end of the planned $14-to-$16-a-share range.

On Monday, Tesla boosted the number of shares it plans to offer in the deal by 20% to 13.3 million shares, of which insider holdings will constitute 1.4 million shares. In all, the deal could raise $244 million. Sweet surmises the stock could pop by 10% to 15% over the offer price in first-day trading. Tesla will trade on the Nasdaq under the ticker symbol TSLA.

Handling the offering are Goldman Sachs Group, Morgan Stanley, J.P. Morgan Chase and Deutsche Bank Securities.

Immediately after the IPO, Tesla plans to sell $50 million in shares to Toyota. The electric-car maker recently agreed to buy Toyota's Fremont, Calif., manufacturing facility for $42 million. That deal included an investment from the Japanese company as part of a broader partnership between the pair.

Musk, 38, is expected to own 28% of Tesla's stock after the IPO.

Sales of the Tesla Roadster began in 2008, followed up last year with the Roadster 2. As of March 31, Tesla had sold 1,063 Roadsters to customers in 22 countries and had unfilled reservations for a further 110.

Tesla does not expect to make a quarterly profit until at least 2012. Through March 31, the company's net loss since inception approaches $300 million. It has generated $147.6 million in revenue over the last five years.

link:

http://www.freep.com/article/20100629/BUSINESS01/6290366/1210/business01/Tesla-Motors-stock-to-hit-market-today

Share this post


Link to post
Share on other sites

Your content will need to be approved by a moderator

Guest
You are commenting as a guest. If you have an account, please sign in.
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoticons maximum are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Sign in to follow this