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Tesla IPO raises $202 million

June 29, 2010 at 1:35 PM   |   Comments

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NEW YORK, June 29 (UPI) -- The public debut of California carmaker Tesla Motors arrived with a 12 percent jump in share prices Tuesday, although prices retreated about 6 percent.

Share prices Tuesday wavered from $19 per share in early trading to $18.02, MarketWatch reported.

With an issue of 11.88 million shares, Tesla's initial public offering raised $202 million while Chief Executive Officer Elon Musk parted with more than 900,000 privately owned shares, reaping $15.3 million on the day. And additional 500,000 privately held shares were sold, MarketWatch said.

Musk also intends to hold onto 28 percent of the company. In addition, Tesla is selling $50 million in shares to Toyota Motor Corp. following the IPO.

"The investment is a risk for investors, but some risks pay off," said Jeremy Anwyl, CEO of online car market Edmunds.com.

Founded by Musk and Chief Technical Officer J.B. Straubel in 2003, Tesla is the first American car company to go public in more than five decades.

While the industry as a whole gears up for a push toward alternatively powered cars, Tesla has yet to make a profit.

It currently produces a Roadster that sells for as much as $100,000 and is banking on the Model S, which will sell for about $50,000 and will not be available until 2012.

About 2,200 customers have given the company down payments of $5,000 for the Model S, which will be made at a former Toyota plant in North Carolina.

© 2010 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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