All of this is compounded by the fact that today The Financial Times reported that Saudi Arabia wealth funds had bought up to a $2 billion stake in Tesla recently, so its feasible that Musk has secured funding from overseas interests. I own about 20% of the company now, and I don't envision that being substantially different after any deal is completed.
In his typically unorthodox fashion, the eccentric Musk dropped his bombshell on his Twitter account, which he has used as a platform for pranks, vitriol and now for a proposal to pull off one of the biggest buyouts in US history. It zoomed as high as $371 per share before trading was halted at $367 per share just after 2 pm EDT. Others interpreted the tweet as a joke, in specific Musk's reference to "420": a popularized reference to the consumption of cannabis by the marijuana culture.
Elon formally lays out his idea of going private.
Marketwatch now lists Telsa's market cap at a little over $US58 billion ($78 billion). "His credibility has come into question over a number of things". They are also shielded from the ups and downs of the stock market. That report had already lifted Tesla's stock about 30 minutes earlier. He apologized for the comments last week in Tesla's latest conference call, saying "there's no excuse for bad manners".
The tweet, so out of the blue that media outlets first thought Musk's Twitter account may have been hacked, assured shareholders that the money to take the electric-car maker was in the bag. "He originally brought Tesla public in 2010, given he could no longer personally finance its growth, and has continually expressed his frustration with the company being public".
Shortly after that news, Musk tweeted again that current shareholders would have the option of selling their shares at $420 or holding them privately. "Being public definitely increases the management overhead for any given enterprise".
The decision to go private would have to be approved by shareholders, but Musk believes taking Tesla private would be an "enormous opportunity for all of us".
Supporters of Musk and the company view him as a visionary akin to Apple co-founder Steve Jobs, while critics have likened him to a "Wizard of Oz" like figure who has yet to turn a profit. "His missions are big and make it hard to accommodate investors quarterly expectations". In the same article from Bloomberg, Munster said "our guess is there is a 1 in 3 chance that he can actually pull this off".
Tesla doesn't meet the typical profile of a company that can raise tens of billions of dollars of debt.
Musk's tweet comes as Tesla faces continued pressure to ramp up output of the Model 3 sedan, its first effort at the middle market.
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