(Reuters) -Tesla Inc unveiled a $5 billion capital raise on Tuesday, its second such move in three months as the electric-car maker cashes in on a meteoric rally in its shares this year.
The company’s shares touched a record high on Monday, pushing Tesla’s market capitalization above $600 billion and further cementing its position as the most valuable auto company in the world despite production that is a fraction of rivals such as Toyota Motor, Volkswagen and General Motors.
The interest in its shares got another boost when S&P Dow Jones Indices said in late November that Tesla would be added to the S&P 500 index, making it one of the most valuable companies ever to be join the benchmark.
Ten major banks, including Goldman Sachs, Citigroup Global Markets and Morgan Stanley, will conduct the sale, the carmaker said in a filing, giving no timeline for its completion. (https://bit.ly/33QXGmU)
In September, Tesla said it would raise $5 billion to ease its future debt pressures as the company seeks to massively expand production of its existing vehicles and build new factories near Berlin, Germany and Austin, Texas.
The company also plans to launch new lines of vehicles, including a semi-truck called the Tesla Semi and its futuristic Cybertruck.
Many investors believe Tesla’s stock is in a bubble, and some have warned against adding it to the S&P 500 at current levels.
The company’s shares fell 2% to $627 in premarket trading.
(Reporting by Munsif Vengattil; Editing by Shounak Dasgupta and Saumyadeb Chakrabarty)
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