Elon Musk Drops Plan To Take Tesla Private

Elon Musk Drops Plan To Take Tesla Private
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25 Aug, 2018 Uploaded by: Mick Presentation
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Two weeks after his bombshell tweet, Tesla CEO Elon Musk reverses stand, says the better path is for Tesla to remain public Elon Musk scrapped his plan to take Tesla Inc. private, a remarkable reversal more than two weeks after blindsiding employees and investors with the idea in a bombshell tweet. In a blog post published late Friday, Tesla’s chairman, CEO and largest shareholder said he had met with the board and “let them know that I believe the better path is for Tesla to remain public. The Board indicated that they agree.” The about-face ends speculation about how Musk would raise money to take Tesla private, but it’s unlikely to ward off scrutiny of the maverick CEO’s actions. Musk’s 7 August tweet that he wanted to take the electric-car maker private at $420 a share and had “funding secured” sent the shares soaring before it became apparent he did not have financing lined up. The episode led to a subpoena from the Securities and Exchange Commission, according to a person familiar with the matter. Musk’s behavior, including a tearful interview with The New York Times that touched on his lack of sleep, has led to calls for Tesla to hire a chief operating officer to help reduce stress on the CEO. Musk, who also runs the rocket-launching company SpaceX and a tunnel-drilling outfit called the Boring Co., is busy trying to ramp up Tesla’s production of the Model 3 sedan and make the company profitable in the second half of the year. In a 13 August blog post, Musk indicated that he believed based on conversations with Saudi Arabia’s Public Investment Fund that he had financial support to go private. In his blog post Friday, Musk reiterated his “belief that there is more than enough funding to take Tesla private” but said a transaction would be distracting and take too long. “Given the feedback I’ve received, it’s apparent that most of Tesla’s existing shareholders believe we are better off as a public company,” wrote Musk. “Although the majority of shareholders I spoke to said they would remain with Tesla if we went private, the sentiment, in a nutshell, was ‘please don’t do this..’” Musk declined to comment further Friday on how he arrived at his decision. He was active on Twitter late Friday, sharing updates about SpaceX and a Hyperloop pod competition. In a separate statement, a committee of independent directors formed to review Musk’s proposal confirmed the decision and announced its intention to dissolve. “We fully support Elon as he continues to lead the company moving forward,” the three board members said.

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