No Tesla Deal! Musk Backpedals Furiously Friday Night, by Wolf Richter

The water’s leaking into the Tesla rowboat faster than Elon Musk can bail. From Wolf Richter at

Turns out, “Funding secured” was a lie, conceived in order to manipulate up the share price.

Tesla CEO Elon Musk has superseded the infamous August 8 tweet — “Am considering taking Tesla private at $420. Funding secured” — which had caused market capitalization to spike by about $6 billion, with a blog post late Friday in which he says that funding was never secured, but that instead it was his “belief” there was “more than enough funding,” and that the buyout isn’t going to happen at all.

We’ll get to some of the rigmarole in a moment, but deep down in his blog post, Musk says this:

After considering all of these factors, I met with Tesla’s Board of Directors yesterday and let them know that I believe the better path is for Tesla to remain public. The Board indicated that they agree.

So the mind-deal is off.

Here’s what he says about the advisors he hired after the “funding secured” tweet, and not before:

I worked with Silver Lake, Goldman Sachs and Morgan Stanley, who have world-class expertise in these matters, to consider the many factors that would come into play in taking Tesla private, and to process all the incoming interest that we received from investors to fund a go-private transaction.

And then there are the current shareholders to consider:

I also spent considerable time listening to current shareholders, large and small, to understand what they think would be in the best long-term interests of Tesla.

He did this after all hell had broken loose following his tweet, including a market reaction that indicated that there was a zero percent chance the buyout would happen at $420 a share, given that shares were trading as much as $120 below the buyout price.

And so, “based on all the discussions that have taken place over the last couple of weeks,” there are now – late Friday, August 24, not August 8 when he was tweeting-while-driving — “a few things” that are finally “clear” to him:

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.

Additionally, a number of institutional shareholders have explained that they have internal compliance issues that limit how much they can invest in a private company.

To continue reading: No Tesla Deal! Musk Backpedals Furiously Friday Night


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.