Elon Musk, the CEO of electric car manufacturer Tesla, stated on Monday that he is negotiating with the Saudi Arabian public investment fund and other potential investors regarding a plan to privatize the company, according to TechCrunch.
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The statement, published on the blog of Tesla’s official site, comes six days after Musk shocked investors with a post on Twitter in which he said he was considering taking Tesla private, adding that shareholders would be offered $420 per share and that financing was “secured.” Forbes questions how crazy the requested amount is.
Musk’s tweet from last week is under investigation by the U.S. Securities and Exchange Commission, reports the Wall Street Journal, and is the subject of lawsuits filed by investors. Wall Street expresses skepticism regarding Musk’s ability to carry out what could be the largest such transaction in history, valued at $72 billion.
Musk said on Monday that he expects two-thirds of Tesla’s shareholders to remain owners in the private company, adding that he is negotiating his proposal with major shareholders.
He stated that most of the capital for this move would come from equity and that it would not be “wise” to burden the company with additional debt. Discussing all the details of the plan, including sources and methods of financing, is currently premature, Musk said.
“I left the meeting on July 31 without seeking an answer to the question of whether the deal with the Saudi fund could be concluded and with the belief that it is just a matter of initiating the process,” Musk said. “That is why I stated in the announcement on August 7 that the financing for the buyout is secured.”
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He said that the CEO of the Saudi public fund expressed support for the plan and announced the continuation of the company’s due diligence process. “I continue to negotiate with the Saudi fund and I am also negotiating with several other investors, which is something I have always planned to do because I want Tesla to continue to have a broad base of investors,” Musk said.
Tesla shares experienced a decline today after Musk revealed details about the financing, according to MarketWatch.
