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Tesla Plans $2 Billion Capital Boost
Tesla Inc. hopes to raise $2 billion through a debt and stock offering after CEO Elon Musk acknowledged last week that the company might raise more capital.
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Tesla Inc. hopes to raise $2 billion through a debt and stock offering after CEO Elon Musk acknowledged last week that the company might raise more capital.
The plan would offer $1.4 billion in bonds, plus as much as $650 million in Tesla shares over three years. Musk intends to buy $10 million worth of the new stock.
The funding comes after Musk repeatedly said last year that Tesla no longer needed new capital. But he changed his position last week after Tesla reported a 13% drop in unit sales. Analysts noted that the slump cut the company’s available cash to a three-year low of $2.2 billion.
At the time, Musk said “dramatic improvements” in Tesla’s manufacturing efficiency and cost reduction lent merit to the idea of raising capital.
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