That came after Musk voiced similar thoughts on Twitter merely an hour earlier, writing: “Am considering taking Tesla private at $420”.
Tesla CEO Elon Musk shocked investors when he tweeted to his 22.3 million followers on Tuesday suggesting the electric vehicle maker could go private at $420 per share, while noting, “funding secured”. He did not identify the would-be buyer or buyers. This would enable you to still share in the growing value of the company that you have all worked so hard to build over time.
Starting in November, Tesla faces repayment of $1.7 billion in debt over the next 18 months that is tied to the company’s stock price.
Tesla didn’t immediately respond to a request for comment.
Making money has proven elusive for Tesla while it has been investing in electric auto technology and ramping up production of its vehicles, including a sedan with a starting price of $35,000 to appeal to a broader audience. However, they are still a long way off the $420 price teased by Musk. In May, after Tesla reported a loss of more than $700 million for the first quarter, he dismissed one question on the earnings call.
Musk said Tuesday on Twitter that he had secured funding for a deal to take Tesla private that would value the company at more than $70 billion. “Already do this with Fidelity’s SpaceX investment”, Musk tweeted, referring to the private space launch company Musk also runs.
Tesla’s shares were up 6.5 percent at $363.46. “Funding secured”, Musk tweeted at 12:48 p.m. EDT (1648 GMT).
Despite the fact that publicly-available FEC documents prove his donations to the PAC, Musk tweeted on Saturday that “reports that I am a top donor of the GOP are categorically false”. Netflix stock moved higher as a result.
Tesla said in a regulatory filing in 2013 that investors interested in keeping up with Tesla should follow Musk’s account.
Still, the tech-heavy NASDAQ exchange where Tesla is listed halted trading over the uncertainty of whether Musk’s tweet may have violated any Securities and Exchange Commission rules that prevent company executives from making market-moving statements. Such backers begged Musk on Twitter to be allowed to keep their shares, and Musk assured them that they could. The tweet was apparently an April Fool’s joke.
If Musk decides against going private, Gordon said his credibility could take another hit, though one he could weather.
Asked whether he would continue to be CEO under such a scenario, Mr Musk replied there would be “no change”.
Musk and his luxury automaker have been under vast pressure to overcome repeated delays and deliver on promises of producing 5,000 of Tesla’s more affordable Model 3 cars per week.
In his blog post, Musk said he wants to give shareholders an option.