Tesla to raise $185 million from IPO, private placement

The company said the IPO of 11.1 million shares will be priced at $14 to $16 per share.

Tesla becomes the first U.S. company to go public in more than half a century since Henry Ford's Ford Motor Co made its share debut in 1956.

The IPO represents a landmark in the resurgence of electric car technology that most car makers until recently had dismissed as impractical.

Immediately after close of the IPO, Toyota will purchase $50 million of Tesla shares at the IPO price, the company said in a regulatory filing.

Toyota's move is expected to give the Japanese automaker a chance to repair its dented public image and vault the California start-up on to the world stage.

The David-and-Goliath handshake highlights a changing dynamic in the auto industry, where newcomers such as Tesla and BYD Co of China are challenging established players in the uncharted field of mass-produced all-electric vehicles.

Tesla aims to tap Toyota's expertise in mass production while Toyota wants to win back public support hurt by its Prius hybrid recalls and San Francisco Bay Area protests against its decision to close the plant that Tesla is buying.

Six-year-old Tesla's losses widened to $29.5 million for the quarter ended March 31, from $16 million a year ago.

We will continue to incur operating and net losses each quarter until at least the time we begin significant deliveries of the Model S, which is not expected to occur until 2012, and may occur later, the company said.

Tesla, best known for its $109,000 all-electric Roadster, said it will sell 10 million shares while selling shareholders will offer 1.1 million shares.

The Palo Alto, California-based company said it will use the proceeds to fund expansion of Tesla stores, working capital and for general corporate purposes.

For 2010, the company expects capital expenditures of $100 million to $125 million.

Reuters reported in November last year that Tesla was preparing to file for an IPO.

Underwriters of the offering are Goldman Sachs, Morgan Stanley, JP Morgan and Deutsche Bank Securities.

Tesla said it will apply for a listing on Nasdaq Global Markets under the symbol TSLA.

(Reporting by Archana Shankar in Bangalore; Editing by Gopakumar Warrier)