That going private thing at Tesla? Never mind, says Elon Musk
Never mind. Tesla won’t be going private after all.
In a Friday night post on Tesla’s website, Tesla CEO Elon Musk said major shareholders told the company “we are better off as a public company” and beseeched him to drop the plan. That refutes a plan Musk laid out in an Aug. 7 tweet that claimed there was “funding secured” at a share price of $420. Tesla finished trading Friday, before Musk’s latest tweet, at $322.82.
“The sentiment, in a nutshell, was ‘please don’t do this,’” Musk wrote.
He said met Thursday with Tesla’s board of directors, whose members “indicated that they agree.” Left unclear was whether the Tesla board will move to bring in an executive to run day-to-day operations, as many analysts and investors have suggested.
The stunning news comes after two weeks of high drama. The “funding secured” tweet sent Tesla’s stock price soaring and sparked a Securities and Exchange Commission inquiry, and the creation of a special Tesla board of directors committee to evaluate Musk’s plan. Then came an interview in the New York Times that had Musk in tears complaining about long hours and high stress.
Musk has never revealed who, if anybody, had pledged financing for such a deal, which would result in the largest private buyout ever, at $70 billion to $80 billion. Tesla reportedly hired Morgan Stanley and Goldman Sachs as advisers on the deal.
In his latest post, Musk said “my belief that there is more than enough funding to take Tesla private was reinforced during this process.” But he identified no investors, dollar amounts or other details.
Musk’s post appeared about 8 p.m. Friday, well after stock markets closed, with a full weekend ahead before U.S. trading resumes. He pledged to focus on production of the Model 3 and trying to earn profits. “We now need to show we can be sustainably profitable,” he wrote.
The Aug. 7 tweet said Tesla would offer $420 per share, 23% above the Aug. 6 closing price. If all the shares were bought, the deal would be worth $72 billion, but Musk later said he expected only one-third of stakeholders to agree to the buyout.
The bizarre tweet, written while Musk was driving to the airport, brought an inquiry from the U.S. Securities and Exchange Commission, which reportedly is looking into whether he was trying to manipulate the share price.
10:25 p.m.: This article has been written through with a staff report.
This article was originally published at 8:40 p.m.