DETROIT (AP) - Electric car maker Tesla Motors said Thursday it hopes to raise around $500 million in a stock offering that comes as it prepares to roll out its highly anticipated new SUV.
Tesla will offer 2.1 million shares and expects net proceeds of $492.6 million. Tesla could make up to $566.5 million if the underwriters exercise their option to buy additional shares.
Tesla CEO Elon Musk intends to purchase $20 million worth of stock.
The company's shares rose 1 percent to $240.94 in late afternoon trading.
Wall Street had been expecting the move. Asked last week during the company's second-quarter earnings call if Tesla planned to raise capital, Musk said there might be value in doing so "as a risk reduction measure."
"I don't think that there's not a need to raise equity capital," Musk said. He said the company should have at least $1 billion in cash on hand; it ended the quarter with $1.2 billion in cash and cash equivalents.