Tesla shares dip after Elon Musk proposes going private

Tesla and SpaceX CEO Elon Musk at a SpaceX press conference in Cape Canaveral Fla. on Feb. 6 2018. More

Shares were down 3 percent in premarket trading after closing up 11 percent at $379.57 on Tuesday.

The US Securities and Exchange Commission has made inquiries into Tesla in the wake of Musk's tweets, The Wall Street Journal reports.

Tesla said on Wednesday the discussions had addressed the issue of how to fund such a deal, but gave no details.

Tesla posted a new blog to its site, essentially a copy-and-paste of an email Musk sent to Tesla's employees regarding taking the company private again.

Tesla Inc Chief Executive Officer Elon Musk'splan to take the electric auto maker private raised doubts among Wall Street analysts about the billionaire' s ability to gather enough financial backing to complete the deal.

In a statement on Tesla's website bit.ly/2vJiaMm, six of Tesla's nine directors said the board had met several times over the last week to discuss such an idea and was "taking the appropriate next steps to evaluate this".

The most obvious equity partners for Musk would be a sovereign wealth fund such as Saudi Arabia's Public Investment Fund (PIF), which sources said on Tuesday had taken a stake of just below 5 percent in Tesla, or a major technology investment fund such as SoftBank Group Corp's (9984.T) Vision Fund, bankers said.

The move to take the company public would remove Musk, who himself has a 20 percent stake, from the public arena - and contentious criticism.

Teresa Goody, a former SEC official, said Musk "did something inappropriate and caused chaos in the market" in a way that would likely draw scrutiny from investigators.

Man City boss Guardiola lauds Bernardo Silva 'masterpiece'
Aguero then set up Foden, whose low drive was stopped by the Chelsea keeper, but with 58 minutes gone Aguero put City 2-0 up. But they produced a controlled and efficient performance to secure their third piece of silverware in the past six months.

Family of missing U.S. student crowdfund for her return: ‘She’s out there’
Ms Tibbetts was reported missing the next morning when she didn't show up for work at a day care centre in a nearby town. Rob Tibbetts, the young woman's father, called the reward "another tool in our arsenal" to bring her home.

Mark Zuckerberg’s fortune tumbles $16.8 billion in a day
Global DAU rates increased by 11% compared to the year-ago quarter, but they were still below what Wall Street was calling for. Shares plunged 19% on Thursday after executives warned that revenue growth would slow as the company focuses on user privacy.

'Basically, I'm trying to accomplish an outcome where Tesla can operate at its best, free from as much distraction and short-term thinking as possible, ' Musk wrote.

Musk's proposed move is seen as a strategy to avoid several issues: Wild stock swings, short-sellers who profit on stock value drops and shareholder pressure on quarterly performance, according to the Financial Times.

Tesla's CEO also laid out what he envisions as the ideal path for going private.

China's Tencent Holdings Ltd, which took a 5-percent stake in Tesla previous year, could also be a possible partner.

The Tesla board responded to the proposal earlier Wednesday morning, indicating that it is evaluating things. 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.

But the board offered no further details of the proposal or its funding, sparking new questions about the feasibility of the master gambit Musk revealed in a surprise series of midday tweets on Tuesday.

Two of the potential stumbling blocks to Musk's plan include the stock price premium not being enough to get the existing shareholders on board to support the sale and coming up short on the announced funding to complete the transition.

If the content of Musk's tweet was not true, lawyers argue, it could expose Tesla's mercurial chief executive officer and the company to regulatory action and private lawsuits.

Related news:

Hot News

isis-killer-beheading-video-story-top Saudi Arabia crucifies convicted murderer
Aug 08, 2018 - 22:55
The kingdom has also expelled Canada's ambassador Dennis Horak, giving him 24 hours to leave the country over the intensifying diplomatic row .

isis-killer-beheading-video-story-top Chris Collins, Donald Trump and Republicans’ corruption perception problem
Aug 08, 2018 - 22:50
The company's stock price fell more than 90 percent after results of the drug trial were released publicly, the documents state. Collins' dealings with Inate Immunotherapeutics are also the subject of an ongoing congressional ethics probe .

isis-killer-beheading-video-story-top Mendocino Complex Fire Becomes Largest Blaze in California History
Aug 07, 2018 - 23:25
Exhausted firefighters across the state are trying to contain 16 major fires that are burning in hot, dry and windy conditions. The Cedar fire in 2003, now the third-largest, devoured 273,246 acres in San Diego County, according to Cal Fire records.

isis-killer-beheading-video-story-top Elon Musk considers taking Tesla private as stock jumps
Aug 07, 2018 - 22:12
Tesla now has a market value around $60 billion, which would make its take-private price tag about $80 billion, Galloway said. The company underwent an initial public offering in 2010. "I believe Tesla considers Tweets as public disclosure".

isis-killer-beheading-video-story-top Accountant Manafort admitted that he forged documents
Aug 06, 2018 - 16:17
And if Manafort was actively trying to circumvent lending laws, he wouldn't send emails to his accountant and bookkeeper about it. Manafort signed an agreement to account for that loan that was backdated, according to Laporta and an exhibit shown to the jury.

isis-killer-beheading-video-story-top State GOP would rather not mention Trump in campaign
Aug 06, 2018 - 16:04
The Ohio rally was Trump's third of the week and he has pledged to accelerate his pace further as the midterms approach. Trump trained fire on one of his new targets, Democrat Representative Maxine Waters of California.

isis-killer-beheading-video-story-top Birthday girl Meghan shines alongside Prince Harry at lavish celebration
Aug 06, 2018 - 15:45
Van Straubenzee has known the prince since childhood and was an usher at Harry and Meghan's wedding at Windsor Castle in May. And, per usual, she looked extremely chic in a Club Monaco dress, paired with Aquazzura shoes and a Philip Treacy hat.

isis-killer-beheading-video-story-top Assassination by drone? Venezuela's President avoids plot to kill
Aug 06, 2018 - 15:00
The drone-bomb assassination attempt on Venezuela's president has raised fears of copycat efforts by terrorists elsewhere. Despite the optics, Smilde said he suspected that Maduro would nonetheless find a way to take advantage of it.

isis-killer-beheading-video-story-top Everton agree Yerry Mina deal with Barcelona?
Aug 06, 2018 - 14:22
The final opinion [on if he stays or goes] is with the coach [Valverde]". "That's something I've really felt at this club". Alderweireld could wait a year to become available but Graves reckons he will be heading to Old Trafford in this window.

isis-killer-beheading-video-story-top Charlotte Rae, star of 'Facts of Life,' dies at 92
Aug 06, 2018 - 12:05
Garrett on Diff'rent Strokes, paid tribute to all of his late costars: "RIP IN PEACE ALL OF MY CAST MATES. A 1958 publicity photo heralds Charlotte Rae's appearance in a variety show at Chicago's Empire Room.

isis-killer-beheading-video-story-top NBA Players Back LeBron In Controversy Over Trump Tweet On Intelligence
Aug 04, 2018 - 22:45
It may be a reference to Michael Jordan , the NBA Hall-of-Famer whose legacy James is endlessly compared with. Lemon's chief offense was apparently making James look smart, which Trump said "wasn't easy to do".

isis-killer-beheading-video-story-top Urban Meyer and the God Complex in College Sports
Aug 03, 2018 - 07:31
In 2009, Smith was arrested on a charge that Courtney Smith later dropped. He was Ohio State's wide receivers coach until his firing last week.

isis-killer-beheading-video-story-top Eel Fire becomes third large wildfire in Mendocino County to ignite
Aug 03, 2018 - 01:33
Officials said Wednesday that the Carr Fire was the sixth most destructive wildfire in California history. Redding Police on Tuesday asked for help from the public locating four people who are still missing.

isis-killer-beheading-video-story-top Zanu-PF signals a Mnangagwa win
Aug 03, 2018 - 01:25
Gunfire crackled as troops, backed by armoured vehicles and a military helicopter, cleared the streets of opposition protesters. Under Mugabe, the law was used routinely to ban anti-government meetings and demonstrations since its enactment in 2002.

isis-killer-beheading-video-story-top Samsung Targets iPad Pro with Galaxy Tab S4
Aug 02, 2018 - 23:54
Samsung said it also made a decision to hand out dividends of 354 won per shares, with the combined amount of 2.4 trillion won. The company said it plans to showcase various QLED models to meet with the high seasonal demand expected for later this year.