California-based electric car maker Tesla Motors plans to raise up to US$100m in an initial public offering, the Los Angeles Times reported, citing a company filing with the Securities and Exchange Commission (SEC).
The paper said share pricing and availability timing was still unclear though industry observers expected the much-anticipated offering to be received well by investors.
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David Menlow, president of IPOfinancial.com, told the LA Times selling stock to the public would bring the company closer to becoming independently profitable.
“This could propel them into a more prominent position in the auto industry,” Menlow said. “The question is how they’re going to be able to rein in their costs.”
The IPO would be a first among electric car companies, which have shown life in recent years in response to high oil prices.
The report noted that the automaker’s high costs have been buffered by government cash, with Tesla recently winning approval for a US$465m loan from the federal government.
Menlow said he expected high investor interest but said many would take a wait-and-see approach to how viable an investment in the car company would be.
“Making the jump from a concept to an IPO to a financially sound investment, there are many mountains to climb,” he said.
“As we continue to get more information, it’s not going to be the sex appeal of the technology anymore, it’s going to be ‘Are they going to be able to survive?’ “
