Elon Musk Talked With SoftBank About Tesla Investment in 2017

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Tesla's board on earlier on Wednesday said it was evaluating taking the company private, which would be the biggest leveraged buyout of all time.

Tesla's chief executive Elon Musk met with SoftBank CEO Masayoshi Son in April 2017 about the Japanese investment firm assisting in taking Tesla private, Bloomberg reported Wednesday.

In a note to clients, Morgan Stanley analyst Adam Jonas said Musk's strategy to reveal the offer on Twitter might end up costing him in higher costs and financial risk. His tweets didn't really explain why he wanted to do that, but a new email explains why. "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".

Musk, who has had a contentious relationship with Wall Street analysts, and short-sellers who bet against his stock, tweeted on Tuesday that he could take the company private at $420 per share-but Farley said a company doesn't necessarily run better if it's out of the public eye. That said, if they do want out, they can sell their shares at $420 per share, which is a fair bit higher than Tesla's current stock price ($382.67 at the time of writing, up from today's open price of $343.84). "Funding secured." - created what some attorneys are calling a potential battleground for lawsuits, regulator investigations and shareholder action. "He has done enough things that might warrant somebody taking a close look", Pitt said.

No board member has come forward to back the plan.

Going private is one way to avoid close scrutiny by the public market as Musk and the company face those challenges. Tesla is a legendary cash-burner, with roughly $10 billion in debts and $2 billion in reserves, and Musk would probably need in the tens of billions of dollars to buy out shareholders at the right price.

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Names excluded from the board statement were Musk; his brother, Kimbal Musk; and Steve Jurvetson, a venture capitalist and early Tesla backer who's been on leave since past year.

Tesla's shares were down less than one per cent at $376.31 United States in morning trading on Wednesday after closing up 11 per cent at $379.57 U.S. on Tuesday. "And if you stay as a shareholder you get less information than before and you depend more and more on Elon Musk".

A Tesla spokesperson declined to comment.

Investors have also questioned why the maneuver was not listed in a 69-page SEC filing, submitted last week and released Monday, that provided intricate detail of Tesla's financial outlook and coming events.

Former SEC chair Harvey Pitt told CNBC that while the U.S. stock market regulator permits executives of publicly listed companies to use social media to make statements about their businesses, Musk's tweet was still "highly unprecedented".

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