Electric car company Tesla Motors Inc (NASDAQ:TSLA) is trying to ride on the stock’s recent performance by raising more money, offering new common and convertible shares.

Tesla Motors

Elon Musk, Tesla Motors Inc (NASDAQ:TSLA)’s Chief Executive Officer and cofounder, also intends to purchase shares of common stock at the same public price for an aggregate purchase price of $100 million. Out of this amount, roughly $45 million would be purchased in the common stock offering, while approximately $55 million would be purchased directly from Tesla Motors Inc (NASDAQ:TSLA).

The direct purchase offering would be made in a subsequent private placement, due to waiting period criteria imposed by the Hart-Scott-Rodino Act.

Elon Musk, CEO Tesla Motors Buying Shares, Why?

CEO Elon Musk has been following a consistent approach by buying shares in Tesla Motors Inc (NASDAQ:TSLA)’s IPO to give investors confidence. This sends a strong message that he’s got plenty of skin in the game to make sure Tesla succeeds.  Besides, Musk also put money into the company in its pre-public days to help loosen the wallets of venture capitalists who had been burned on failed cleantech deals.

The electric car major Tesla Motors is offering 2.7 million shares of common stock worth about $244 million now in a follow-on offering, plus $450 million in a convertible senior note due 2018, the company said Wednesday. Tesla has also granted the underwriters a 30-day option to purchase up to an additional 405,454 shares of common stock and $67.5 million in aggregate principal amount of the notes.

Tesla Motors Inc (NASDAQ:TSLA) did not announce the interest rate, conversion price and other terms of the notes on its convertible note offering. Tesla also didn’t indicate a price for its secondary stock offering.

Tesla Motors Inc (NASDAQ:TSLA) shares closed Wednesday trading up nearly 2 percent to $84.84. In after-hours trading, shares gained over 5 percent to $89.39, on news of the capital raise.

The electric car company’s stock hit its highest price on record on May 14, topping out at $97.12. The stock was trading below $40 three months ago. Tesla’s stock rose over 50 percent in just five trading sessions, after it surprised the market with strong quarterly performance.

Interestingly, with a value reaching $9.6 billion, Tesla Motors Inc (NASDAQ:TSLA) was at least briefly more valuable than Fiat.

The electric car company intends to book $830 million in proceeds from the capital raise and anticipates using the cash primarily to prepay Tesla Motors Inc (NASDAQ:TSLA)’s outstanding loan from the United States Department of Energy. Tesla will also enter into hedging transactions aimed at preventing dilution from the convertible notes.