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Elon Musk’s $97b tweet with plan to take Tesla private

08 August 2018

It's not uncommon for trading in a stock to be halted in the wake of unexpected or unsettling news.

The tweets have added to speculation about Tesla, which is spending heavily as it ramps up production of its latest auto, the Model 3.

However, he concedes Musk has good reason to take Tesla off the public markets, and he's established precedent through SpaceX and The Boring Company.

He added that he hoped all shareholders would remain and that all Tesla employees would "remain shareholders of the company".

Musk said in subsequent tweets that he would remain chief executive under a go-private transaction and that any deal would benefit shareholders.

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The numbers from the report indicate that the PIF, which has more than $250 B in assets, has a stake of between $1.7 B and $2.9 B at Tesla's current share price.

Mr Musk also previously used his Twitter account to joke that Tesla was going bankrupt in an April Fool's Day tweet and his stability was called into question last month after he called a British diver who helped rescue children from a Thailand cave a paedophile.

Going private is one way to avoid the intense scrutiny of public markets.

The news caused Tesla's share price to jump by $14.

The SEC declined to comment on Tesla, but the regulator has previously declined to sanction Netflix CEO Reed Hastings in 2013 for revealing important company information on Facebook. The Financial Times reported Tuesday that Saudi Arabia's sovereign wealth fund had recently amassed a US$2-bilion stake in Tesla. At $420 a share, Tesla would have a market cap of around $71 billion.

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Around 1:00 pm today, Musk issued a string of tweets about abandoning the company's public listing and taking the company private at $420 United States dollars a share.

Intentions to buy out public shareholders usually need to be filed with the Securities and Exchange Commission, or SEC. "Either they can stay investors in a private Tesla or they can be bought out at $420 per share, which is a 20 percent premium over the stock price following our Q2 earnings call".

He stunned investors on Tuesday with a tweet saying he had already lined up the funding, and he told employees that it would relieve the electric auto company of the "enormous pressure" of Wall Street's expectations.

Tesla CEO Elon Musk shocked investors when he tweeted to his 22.3 million followers on Tuesday suggesting the electric auto maker could go private at $420 per share, while noting, "funding secured". And if the information in the tweet isn't true, Musk could be looking at some stock price manipulation allegations.

The plan would need shareholder approval, but Musk's tweet sent Tesla stock spiking by nearly 9%.

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The mysterious tweet sent out this morning read: "Am considering taking Tesla private at $420". He also said the quarterly financial requirements of being a public company "puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long-term".

Elon Musk’s $97b tweet with plan to take Tesla private