Tesla Inc. board of directors released a statement today making it clear that Elon Musk’s tweet about taking the company private was not a spur of the moment remark, but more of a planned one.
A well timed one to further sweeten the market sentiment on top of news about Saudi’s Public Investment fund building a 3% to 5% stake in Tesla.
Here is the statement from Tesla board of directors
Last week, Elon opened a discussion with the board about taking the company private. This included discussion as to how being private could better serve Tesla’s long-term interests, and also addressed the funding for this to occur. The board has met several times over the last week and is taking the appropriate next steps to evaluate this.
This kind if puts all ethical, moral and legal questions around Elon Musk breaking the go-private news on twitter. The markets main concern was whether Tesla CEO Elon Musk had actually secured funding or was he simply making a statement without any plans to back it up.
Two words on Twitter may haunt Elon Musk : “Funding secured.”, wrote WSJ authors Dave Michaels and Michael Rapoport.
Their concern: “If Tesla doesn’t move ahead with a deal, or if the funding isn’t set, regulators could probe whether Mr. Musk made a false statement that caused the price of his company’s stock to skyrocket about 11%.”
The statement from Tesla board of directors now puts all those questions to rest. Though Tesla is yet to officially make an offer to its existing shareholders and reveal who is backing up CEO Elon Musk’s plan to devise one of the biggest leveraged buyouts in history, it’s now clear that the management has been working on the go-private plan quietly in the background.
We think it could be Tencent behind Tesla’s surprising decision to go private, “Why Tencent Makes Sense for the Tesla Motors Take-private Move“. Let us know your thoughts in the comments section.