Electric car maker Tesla prices IPO at $17 a share
Tesla Motors Inc., the Silicon Valley-based electric sports-car maker, got a warm welcome from investors in the company’s initial public stock offering late Monday.
Tesla priced its IPO at $17 a share, above the expected range of $14 to $16. The stock will begin trading on Nasdaq on Tuesday under the symbol TSLA.The deal marks the first IPO by an American car company since Ford Motor Co. went public in 1956.
Tesla and current shareholders sold a total of 13.3 million shares, raising $226 million. The company sold 11.9 million of the shares, for $202 million, before brokerage underwriting fees.
Earlier Monday, Tesla said it was boosting the size of the deal to 13.3 million shares from its previous estimate of 11.1 million -- a sign that Goldman Sachs, Morgan Stanley and other major brokerages that were marketing the deal were seeing robust demand from investors.
Tesla, based in Palo Alto, was co-founded in 2003 by Elon Musk, who made a fortune after co-founding PayPal Inc. and selling it to EBay Inc. Musk also is the entrepreneur behind private spacecraft-development firm Space Exploration Technologies Corp., or SpaceX, which is based in Hawthorne.
Tesla has yet to turn a profit. The company introduced its first electric car, the $109,000 Roadster, in 2008. It has sold only about 1,100 of the cars worldwide.
The IPO proceeds will fund production of the company’s new vehicle, the Model S sedan, which is expected to sell for about $57,000. A federal tax credit of $7,500 for electric cars would cut the price to just under $50,000. The commercial launch is planned for 2012.
With the stock sale, Toyota Motor plans to make a $50-million investment in Tesla, and the latter expects to build cars at a now-closed Fremont, Calif., factory that Toyota and General Motors had operated.
The company says its planned Model S car would accelerate from zero to 60 miles per hour in just 5.6 seconds, making it among the quickest four-door sedans on the road. It is expected to get 160 to 300 miles on a single charge, depending on the version.
Whether a viable consumer market will develop for the car isn’t clear, but the IPO investors clearly were giving Tesla the benefit of the doubt.
-- Tom Petruno
Photo: The Tesla Model S. Credit: Tesla Motors