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Tesla to retire $920M in notes with company cash

February 27, 2019

Tesla will retire $920 million worth of convertible notes in cash when they come due on Friday, using up about one quarter of the cash available for capital spending and future debt payments.

The electric car and solar panel company had the option of converting the notes to stock if the price hit an average of $359.87 ahead of Friday’s maturity date.

But that didn’t happen. Shares haven’t closed that high since Dec. 14, and they were trading around $313 on Wednesday.

Tesla says in its annual report that intends to pay the debt in cash. The company had $3.7 billion at the end of last year.

Morningstar Analyst David Whiston says Tesla has to generate more cash to pay debts that come due during the next four years.