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Over two weeks ago, Tesla CEO Elon Musk took everyone by surprise by announcing his intention to take Tesla private. But those plans have been scrapped. Last night, Musk published a blog post saying that he had met with the board and “let them know that I believe the better path is for Tesla to remain public. The Board indicated that they agree.” "Although the majority of shareholders I spoke to said they would remain with Tesla if we went private, the sentiment, in a nutshell, was ‘please don’t do this,” wrote Musk. In a separate statement, Tesla's board of directors confirmed Musk's decision. "Yesterday, we held a Board meeting, during which Elon reported on the work he and his advisors have been doing in connection with this effort. Elon communicated to the Board that after having done this work and considered all factors, he believes the better path is to no longer pursue a transaction for taking Tesla private. After discussing this, we dissolved the Special Committee. The Board and the entire company remain focused on ensuring Tesla’s operational success, and we fully support Elon as he continues to lead the company moving forward," the statement says. This saga began with a tweet back on August 7th, This tweet sent everyone into a tizzy and caused NASDAQ to halt trading of Tesla stock for a few hours. There was one big question, how was Tesla going to fund this? Musk revealed a week later that it would be Saudi Arabia’s Public Investment Fund, though reports say the fund isn't so thrilled about this idea. As we reported earlier this week, the fund is in talks with another electric automaker, Lucid Motors. The announcement has prompted the U.S. Securities and Exchange Commission (SEC) to subpoena the company, along with a number of lawsuits from upset investors. Source: Tesla, Bloomberg -
Over two weeks ago, Tesla CEO Elon Musk took everyone by surprise by announcing his intention to take Tesla private. But those plans have been scrapped. Last night, Musk published a blog post saying that he had met with the board and “let them know that I believe the better path is for Tesla to remain public. The Board indicated that they agree.” "Although the majority of shareholders I spoke to said they would remain with Tesla if we went private, the sentiment, in a nutshell, was ‘please don’t do this,” wrote Musk. In a separate statement, Tesla's board of directors confirmed Musk's decision. "Yesterday, we held a Board meeting, during which Elon reported on the work he and his advisors have been doing in connection with this effort. Elon communicated to the Board that after having done this work and considered all factors, he believes the better path is to no longer pursue a transaction for taking Tesla private. After discussing this, we dissolved the Special Committee. The Board and the entire company remain focused on ensuring Tesla’s operational success, and we fully support Elon as he continues to lead the company moving forward," the statement says. This saga began with a tweet back on August 7th, This tweet sent everyone into a tizzy and caused NASDAQ to halt trading of Tesla stock for a few hours. There was one big question, how was Tesla going to fund this? Musk revealed a week later that it would be Saudi Arabia’s Public Investment Fund, though reports say the fund isn't so thrilled about this idea. As we reported earlier this week, the fund is in talks with another electric automaker, Lucid Motors. The announcement has prompted the U.S. Securities and Exchange Commission (SEC) to subpoena the company, along with a number of lawsuits from upset investors. Source: Tesla, Bloomberg View full article
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Last Tuesday, Tesla CEO Elon Musk tweeted out that he was considering taking the automaker private and had "secured" funding. Since then, the question of who is providing the funding has been left unanswered. Today, Musk wrote up a blog post that provides some insight. The post reveals that Saudi Arabia's Public Investment Fund is responsible for the possible funding of Tesla's move to private. In the last two years, representatives of the fund have met with Musk and discussed possibly taking the company off the market. The most recent meeting was on July 31st, after the fund bought an almost 5 percent stake. "During the meeting, the Managing Director of the fund expressed regret that I had not moved forward previously on a going private transaction with them, and he strongly expressed his support for funding a going private transaction for Tesla at this time. I understood from him that no other decision makers were needed and that they were eager to proceed," Musk wrote. "I left the July 31st meeting with no question that a deal with the Saudi sovereign fund could be closed, and that it was just a matter of getting the process moving. This is why I referred to “funding secured” in the August 7th announcement." The board was notified about Musk's intentions to take Tesla private on August 2nd. From there, the board held a meeting (minus Musk and his brother Kimbal, who is also a board member) to discuss this possibility. Musk also planned to speak to the company's largest shareholders about the possible move. Towards the end of the post, Musk said he is continuing "to communicate with the Managing Director of the Saudi fund," and that "he has expressed support for proceeding subject to financial and other due diligence and their internal review process for obtaining approvals." But there is one big question that is unanswered; did Musk secure the funding when he made that tweet or not? As we reported last week, the Securities and Exchange Commission (SEC) is looking into whether or not Musk was lying about the funding. If Musk was able to get the funding, it will be quite awhile before Tesla can become private. Per the blog post, the board needs to put together a plan that it can agree upon. From there, shareholders will vote on the plan. If approved, Tesla can start on the next steps. Source: Tesla View full article -
Last Tuesday, Tesla CEO Elon Musk tweeted out that he was considering taking the automaker private and had "secured" funding. Since then, the question of who is providing the funding has been left unanswered. Today, Musk wrote up a blog post that provides some insight. The post reveals that Saudi Arabia's Public Investment Fund is responsible for the possible funding of Tesla's move to private. In the last two years, representatives of the fund have met with Musk and discussed possibly taking the company off the market. The most recent meeting was on July 31st, after the fund bought an almost 5 percent stake. "During the meeting, the Managing Director of the fund expressed regret that I had not moved forward previously on a going private transaction with them, and he strongly expressed his support for funding a going private transaction for Tesla at this time. I understood from him that no other decision makers were needed and that they were eager to proceed," Musk wrote. "I left the July 31st meeting with no question that a deal with the Saudi sovereign fund could be closed, and that it was just a matter of getting the process moving. This is why I referred to “funding secured” in the August 7th announcement." The board was notified about Musk's intentions to take Tesla private on August 2nd. From there, the board held a meeting (minus Musk and his brother Kimbal, who is also a board member) to discuss this possibility. Musk also planned to speak to the company's largest shareholders about the possible move. Towards the end of the post, Musk said he is continuing "to communicate with the Managing Director of the Saudi fund," and that "he has expressed support for proceeding subject to financial and other due diligence and their internal review process for obtaining approvals." But there is one big question that is unanswered; did Musk secure the funding when he made that tweet or not? As we reported last week, the Securities and Exchange Commission (SEC) is looking into whether or not Musk was lying about the funding. If Musk was able to get the funding, it will be quite awhile before Tesla can become private. Per the blog post, the board needs to put together a plan that it can agree upon. From there, shareholders will vote on the plan. If approved, Tesla can start on the next steps. Source: Tesla -
Everyone seemed to lose their mind when Tesla CEO Elon Musk tweeted out Tuesday that he was considering taking the company private. For a time, the NASDAQ had to halt trading of Tesla stock because of massive fluctuations in the share price. The reasoning behind this move made sense as it would allow the company to focus on the long-term. But this tweet has also brought some unattended problems. Reuters has learned from sources at Tesla that the board of directors is seeking more information from him as to how the buyout will be financed. As we reported yesterday, the board has talked about this idea for some time. But a source reveals that it hasn't gotten either a detailed plan from Musk, nor any information as to who will provide the funding. Both Reuters and CNBC are reporting that the board will make a decision on whether or not to do a formal review of Musk's proposal in the coming days. It also plans to speak with financial advisers about explore this proposal. Sources tell CNBC that the board will ask Musk to recuse himself from the review process of his proposal. He'll need to hire his own advisers for a review. There is another twist in this story. Musk has talked to Saudi Arabia's sovereign wealth fund about a take-private deal, according to a source. This is likely due to the Saudi's Public Investment Fund buying between a 3 to 5 percent stake in the automaker, worth about $2 billion that was brought to light this week. Tesla's board isn't the only group interested in Musk's plan. Last night, the Wall Street Journal reported that the Securities and Exchange Commission (SEC) is inquiring whether or not Musk was telling the truth when said that he had secured funding for the buyout. Under U.S. law, companies and officials cannot give misleading information about events to shareholders. It is unclear whether or not this will cause an investigation be opened or not. A SEC spokesman declined to comment. Musk could also be in trouble if the SEC find evidence that his tweet was aimed at increasing the company's share price. We'll keep you posted if anything new breaks. Source: Wall Street Journal (Subscription Required), Reuters, CNBC View full article
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Tesla's Board Plans To Meet With Advisers About Going Private
William Maley posted an article in Tesla
Everyone seemed to lose their mind when Tesla CEO Elon Musk tweeted out Tuesday that he was considering taking the company private. For a time, the NASDAQ had to halt trading of Tesla stock because of massive fluctuations in the share price. The reasoning behind this move made sense as it would allow the company to focus on the long-term. But this tweet has also brought some unattended problems. Reuters has learned from sources at Tesla that the board of directors is seeking more information from him as to how the buyout will be financed. As we reported yesterday, the board has talked about this idea for some time. But a source reveals that it hasn't gotten either a detailed plan from Musk, nor any information as to who will provide the funding. Both Reuters and CNBC are reporting that the board will make a decision on whether or not to do a formal review of Musk's proposal in the coming days. It also plans to speak with financial advisers about explore this proposal. Sources tell CNBC that the board will ask Musk to recuse himself from the review process of his proposal. He'll need to hire his own advisers for a review. There is another twist in this story. Musk has talked to Saudi Arabia's sovereign wealth fund about a take-private deal, according to a source. This is likely due to the Saudi's Public Investment Fund buying between a 3 to 5 percent stake in the automaker, worth about $2 billion that was brought to light this week. Tesla's board isn't the only group interested in Musk's plan. Last night, the Wall Street Journal reported that the Securities and Exchange Commission (SEC) is inquiring whether or not Musk was telling the truth when said that he had secured funding for the buyout. Under U.S. law, companies and officials cannot give misleading information about events to shareholders. It is unclear whether or not this will cause an investigation be opened or not. A SEC spokesman declined to comment. Musk could also be in trouble if the SEC find evidence that his tweet was aimed at increasing the company's share price. We'll keep you posted if anything new breaks. Source: Wall Street Journal (Subscription Required), Reuters, CNBC -
Yesterday afternoon, Tesla CEO Elon Musk tweeted this This sent everyone into a tizzy, wondering if he was being serious or not. In fact, NASDAQ had to halt trading of Tesla for a couple of hours because of this tweet. Thankfully, Tesla posted an email that was sent by Musk to employees explaining why. The key reason comes down wanting to minimize distractions and begin focusing on the long term. "But the reason for doing this is all about creating the environment for Tesla to operate best. As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla, all of whom are shareholders. Being public also subjects us to the quarterly earnings cycle that puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long-term," Musk wrote in the email. Musk also made light of the short sellers who bet against Tesla succeeding, saying the company was the most shorted stock "in the history of the stock market". By going private, it gives the company some protection. How would this changeover to private work? Musk said he would like to offer shareholders to either remain or sell their shares at $420 per share (a bit higher than the $375.16 share price at the time of this writing). He would also like Tesla's employees to remain as shareholders. "Basically, I'm trying to accomplish an outcome where Tesla can operate at its best, free from as much distraction and short-term thinking as possible, and where there is as little change for all of our investors, including all of our employees, as possible," the email states. This move will need to be approved by Tesla's board of directors. In a statement released this morning, several members of the board published a statement that echoes the reasons given by Musk. It also reveals that this idea had been on Musk's mind for sometime. "Last week, Elon opened a discussion with the board about taking the company private. This included discussion as to how being private could better serve Tesla's long-term interests, and also addressed the funding for this to occur. The board has met several times over the last week and is taking the appropriate next steps to evaluate this," the statement says. One of those "appropriate next steps" is getting enough money to do the buybacks. Musk in his tweet said he has funding for it, but it is unclear who and how much is being provided. According to MarketWatch, the buyout would total $72 billion if all of the shareholders decide to sell. Source: Tesla, MarketWatch -
Yesterday afternoon, Tesla CEO Elon Musk tweeted this This sent everyone into a tizzy, wondering if he was being serious or not. In fact, NASDAQ had to halt trading of Tesla for a couple of hours because of this tweet. Thankfully, Tesla posted an email that was sent by Musk to employees explaining why. The key reason comes down wanting to minimize distractions and begin focusing on the long term. "But the reason for doing this is all about creating the environment for Tesla to operate best. As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla, all of whom are shareholders. Being public also subjects us to the quarterly earnings cycle that puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long-term," Musk wrote in the email. Musk also made light of the short sellers who bet against Tesla succeeding, saying the company was the most shorted stock "in the history of the stock market". By going private, it gives the company some protection. How would this changeover to private work? Musk said he would like to offer shareholders to either remain or sell their shares at $420 per share (a bit higher than the $375.16 share price at the time of this writing). He would also like Tesla's employees to remain as shareholders. "Basically, I'm trying to accomplish an outcome where Tesla can operate at its best, free from as much distraction and short-term thinking as possible, and where there is as little change for all of our investors, including all of our employees, as possible," the email states. This move will need to be approved by Tesla's board of directors. In a statement released this morning, several members of the board published a statement that echoes the reasons given by Musk. It also reveals that this idea had been on Musk's mind for sometime. "Last week, Elon opened a discussion with the board about taking the company private. This included discussion as to how being private could better serve Tesla's long-term interests, and also addressed the funding for this to occur. The board has met several times over the last week and is taking the appropriate next steps to evaluate this," the statement says. One of those "appropriate next steps" is getting enough money to do the buybacks. Musk in his tweet said he has funding for it, but it is unclear who and how much is being provided. According to MarketWatch, the buyout would total $72 billion if all of the shareholders decide to sell. Source: Tesla, MarketWatch View full article
