Wall Street sees funding hurdle to Musk's plan to take Tesla private

Flags fly over the Tesla Inc. Gigafactory 2 which is also known as RiverBend a joint venture with Panasonic to produce solar panels and roof tiles in Buffalo New York

Musk took Tesla shareholders and the stock market by surprise on Tuesday by announcing on Twitter he was considering taking the loss-making electric car-maker private at $420 USA a share. Shares were down 3 percent in premarket trading after closing up 11 percent at $379.57 on Tuesday.

Ford Executive Vice President Jim Farley on the benefits of being a public company after Tesla CEO Elon Musk tweeted he is considering taking his company private.

The deal would be the biggest leveraged buyout of all time, beating the $45-billion record set by Texas power utility Energy Future Holdings. The company already has a $2 billion investment from Saudi Arabia's sovereign fund as well as Tencent, which took a 5 percent stake in 2017.

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. "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, and where there is as little change for all of our investors, including all of our employees, as possible". "These guys want us to die so bad they can taste it", he said a year ago.


Musk has been under intense pressure this year to turn his money-losing, debt-laden company into a profitable higher-volume manufacturer, a prospect that has sent Tesla's valuation higher than that of General Motors Co.

Mr Musk had "opened a discussion with the board" last week, the six directors said.

Musk hasn't been quiet about his disdain for short sellers.

The brief statement by six of the nine board directors said that the discussions about taking the company private had also "addressed the funding for this to occur". They did not include Mr Musk, his brother Kimbal Musk, and Steve Jurvetson, a venture capitalist.

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