Elon Musk isn't kidding, Tesla board confirms TSLA could go private

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Tesla stock opened at $369.09 on Wednesday, sliding almost 3 percent from its Tuesday closing price of $379.57.

Musk later tweeted that existing stockholders could choose whether to hold onto their shares or sell them to the new investors for $420 a share. "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 statement said.

'Am considering taking Tesla private at $420, ' Musk tweeted, referring to the value of the share price he would have to pay.

Tesla's board, a nine-member group that includes Musk's younger brother Kimbal, issued a belated statement Wednesday morning saying Musk had "opened a discussion" last week with the board about the benefits of taking Tesla private.

Elon Musk and Masayoshi Son held talks a year ago about SoftBank Group Corp. investing in Tesla Inc., including potentially taking the electric carmaker private, according to two people with knowledge of the discussions.

Musk laid out his reasoning for going private in an email to Tesla employees yesterday, which was subsequently posted on Tesla's website. The board has met several times over the last week and is taking the appropriate next steps to evaluate.

Musk owns an nearly 20 per cent stake in Tesla, meaning he'd still need roughly $70 billion in financing to take Tesla private. MarketWatch reported that information like the fact that the CEO is considering taking a public company private is generally supposed to be announced to investors and the public by way of official earnings reports and press releases.

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Musk's tweets caused a flurry of activity in financial markets. Musk owns about 20 percent of the Palo Alto, California, company's stock, so that likely would reduce the cost of the buyout.

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

'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. Many initially thought it was Elon Musk's attempt at a bad joke about marijuana, because "420" has always been associated with pot.

The statement was not from the company's full board of directors.

SoftBank is now not interested in a deal for Tesla after earlier this year taking a stake in General Motors Co's (GM.N) self-driving unit, Cruise, Reuters reported earlier on Wednesday.

The issue of share accumulation by outsiders emerged only recently as reports that Saudi Arabia's public investment fund had built up a stake from 3 to 5 percent after its offers of purchase of new shares in Tesla were spurned by the company. He said funding was "secured", without elaborating. 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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