Tesla card and plan to go private
Tesla council confirmed that it would consider the proposal of the chief executive, Elon Musk to take in private.
A statement was released by the six members of the electric car maker’s board of directors, after Mr. Musk has tweeted to say that he had the financing of the company.
The council had “met several times over the last week” to discuss going private, the statement said.
They said that this “discussion about how to be private to better serve Tesla’s long-term interests”.
Mr. Musk said in his tweet on Tuesday that shareholders would be offered $420(£326) per share, valuing the company at more than $70bn.
This would be the largest part of his nature, the exceeding of the purchase of the utility TXU Corp in 2007 for $ 44bn by a consortium.
The brief statement by six of the nine directors of the commission stated that the discussions about taking the company private has also considered the funding of this place.”‘Wild swings d”
Mr. Musk had “opened a discussion with the board of directors of” last week, the six directors said. They did not include Mr. Musk, his brother, Kimbal Musk, and Steve Jurvetson, a venture capital firm.
The shares reached a peak of $368 after Mr. Musk’s tweets, before being interrupted on the stock market. They were trading above $380 shortly after the members of the commission have issued their statement. Shares are edging towards their record high of $385, they have touched close to a year.
Mr. Musk had written to staff on Tuesday to explain why he wanted to take the company private. “As a public company, we are subject to the wild fluctuations in the market price of our shares, which may be an important source of distraction for all those who work at Tesla, who are all shareholders,” he wrote.
“Being public, subjects us to the quarterly profit cycle that puts a lot of pressure on Tesla to make decisions that can be good for a given quarter, but not necessarily for the long term,” Mr. Musk wrote.
He added that the company was “the most shorted stock in the history of the stock exchange” – a trading strategy that assumes a share, the price will drop – so “being public means that there are a large number of people who have the incentive to attack society”.
These operators are likely to have lost money when the share price rose on the announcement of a withdrawal of the list.
Mr. Musk already holds 20% of the company, and has declared its intention to take the company private was not to increase his personal holding.
Steven Kaplan, a professor at the University of Chicago who researches private equity, has said it would be difficult for Mr. Musk to raise the necessary funding when Tesla has not yet made a profit.
“The company is cash flow negative. How do you use the debt securities on a company that is cash flow negative?” he said.