Tesla raises share offering to $642.5m as stock falls 10%

Tesla Motors (NASDAQ:TSLA) traded up 0.49% on Tuesday, hitting $243.70. This is a no-joke portion for a company worth more than $30 billion. With the new offering, Tesla could raise as much as $750M (same as the amount that was raised in June through debt) if the underwriters exercise their option.

Musk is intending to invest $20 million of common stock in the offering at the public offering price, according to the press release.

PG&E is now on site, evaluating the situation, Tesla said.

Originally estimated to cost Tesla some $5 billion to build, external construction at the Gigafactory is due to finish by the end of the year, with Tesla’s battery partner Panasonic due to enter the factory later this year to install more than $1 billion of specialist lithium-ion battery manufacturing equipment. The Company’s consolidated revenues decreased 26% to $18.2 million in the second quarter of 2015 compared to $24.6 million in the year ago period.

Stocks nearly invariably fall when a company announces an equity sale in order to raise capital.

Underwriters will receive $9.7 million of the $652 million total proceeds.

Musk is telling the market “I’m putting my money where my mouth is”, Jefferies & Co analyst Dan Dolev said. Following the offering, the company projects 129.8 million shares outstanding. Since the last Tesla stock offering, sales and gross profit have both more than doubled. The company is also ramping up production at its Fremont factory for the delivery initiation of its long-awaited sports utility vehicle (SUV), Model X. Apart from these major initiatives, Tesla is rapidly expanding its stores and charging station networks domestically and in overseas markets, such as Australia, China, and the UK. And he’s doing so to a greater extent than the great majority of CEOs of publicly traded companies.