Here's what taking Tesla private means for the company and Elon Musk

Here's what taking Tesla private means for the company and Elon Musk

Here's what taking Tesla private means for the company and Elon Musk

Tesla did not immediately return a request for comment.

"I suspect the corporate lawyers are scrambling right now and hoping the SEC doesn't go after him and the company, because it could be viewed as a statement from Tesla", Peter Henning, a professor at Wayne State University Law School specializing in securities law, explained to the Detroit Free Press regarding Musk's tweet on Tuesday.

Compliance experts are still arguing about whether Musk could face official censure.

A lot of questions remain unanswered but, if Tesla goes through with the plan, it would reportedly be the largest leveraged buyout in history.

It wasn't until Wednesday when six directors on Tesla's nine-member board publicly acknowledged that Musk approached them last week about pursuing the financing for a buyout that would take the company off the stock market.

Musk has 22.3 million followers on Twitter, and Tesla's share price was already rising after the Financial Times reported that Saudi Arabia's sovereign wealth fund had taken a $2bn stake in the company.

"If Apple wanted to be in the vehicle business, this is how you do it-you step up, doesn't have to be $420 (per share), it could be another price".

Public companies have four days https://www.sec.gov/fast-answers/answersform8khtm.html to report certain material events that shareholders should know about to the U.S. Securities and Exchange Commission.

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It seems to have gotten the better of the billionaire who has tweeted that he's considering taking the company private. "Funding secured", the message from Musk, sent out nonchalantly on Tuesday afternoon, stated.

The company is still working its way out of what Musk called "production hell" at its home factory in Fremont, California, where a series of manufacturing challenges delayed the ramp-up of production of its new Model 3 sedan, on which the company's profitability rests.

Going private is one way to avoid scrutiny by the public market as Mr Musk and the company tackle those challenges.

Tesla shares fell 2.4 percent to $370.34 after closing up 11 percent yesterday.

Musk could climb the ranking faster if investors decide Tesla is worth more than its current $58 billion market cap.

"Who gives $30 to $50 billion to buy back the shares?" asked NordLB analyst Frank Schwope.

"Just because" Musk wants it at $420 "doesn't mean that there aren't other people who might be willing to come in with another transaction that would be more beneficial to shareholders", Pitt said. Tesla also would likely need to borrow billions more to help pay for its ambitious plans of its electric vehicle line and its battery manufacturing plants.

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