Tesla announces $1.5 bn bonds issue to fund Model 3

New York Aug 8 (IANS) Tesla announced on Monday that it intends to raise about $1.5 billion in a bond offering as the US luxury electric automaker seeks to fund the production of its new Model 3 sedan.

Shares of Tesla have risen 67 per cent this year and ticked down 0.49 per cent to close at $355.17 on Monday after the announcement Xinhua reported.

The debt offering marks Tesla s debut in the junk bond market.

Moody s is rating the bond B3 with a stable outlook and Standard & Poor s assigned a "B-" rating for the bond issue.

Tesla said in a press release that it intends to use the net proceeds from this offering to further strengthen its balance sheet during this period of rapid scaling with the launch of Model 3 and for general corporate purposes.

While Tesla has received more than 1 800 reservations per day for the Model 3 since its launch in late July Tesla CEO Elon Musk confirmed that he s working on "something special" for early reservation holders.

Tesla Model 3 is a major step for the California-based company and priced around $35 000 each. It "achieves 215 miles (346 km) of range per charge" and is "designed to attain the highest safety ratings in every category."

--IANS
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