TSLA: Tesla Raises $2B in Bond Sale

by Burke Speaker | February 28, 2014 9:08 am

Electric car company Tesla Motors (TSLA[1]) has raised some $2 billion from a US convertible bond sale after upping its offering due to investor demand.

tesla-tsla-stock[2]TSLA stock has risen 70% this year.

The money from the sale will go to its new battery factory, which investors are praising as another way TSLA will push its stock higher and anticipating increased sales by 2020.

Tesla has been on a roll the past week with its stock rising nearly 30% — reaching a market capitalization of $31 billion as its shares boomed. (via Financial Times[3])

Tesla sold $800m in five-year notes and $1.2bn in seven-year notes as part of the deal on Thursday, according to a person familiar with the matter. The five-year notes will carry a coupon payment of 25 basis points and the seven-year notes will pay 125 basis points. Both bonds have an equity conversion premium of 42.5 per cent.

The company had originally sought to raise $1.6bn, but the deal was increased due to heavy demand from investors, according to a person familiar with the matter.

The Tesla offering is said to be the largest U.S. convertible bond deal, according to Dealogic.

This is the second time in as many years that Tesla has used the convertible bond market as a way to finance its business moves.

More Tesla news

  1. TSLA: http://studio-5.financialcontent.com/investplace/quote?Symbol=TSLA
  2. [Image]: https://investorplace.com/wp-content/uploads/2012/03/Tesla185.jpg
  3. via Financial Times: http://www.ft.com/intl/cms/s/0/2f2387a0-a00a-11e3-9c65-00144feab7de.html#axzz2ucok2wBQ

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