After Musk made his initial announcement on August 7, via Twitter, claiming he may have a deal worth $72 billion, valuing the company at $420 a share, Tesla shares rose 11 percent to nearly $380 (£298), But soon after, shares dropped back down.
And it wasn’t but a few days later that some short-sellers cried “foul” accusing Monk of securities fraud, filing a class-action lawsuit and in turn, drawing scrutiny from the Securities and Exchange Commission (SEC).
The SEC is reportedly looking at Musk’s August 7 tweet in which he said he had “funding secured” to take Tesla private.
The “funding secured” comment was seemingly reinforced when stories came out about a possible deal involving officials of the Saudi Arabian Sovereign Wealth Fund, which was quickly disproved. But Musk, who had met with the Saudi officials says he left the meeting with “no question” that a deal could be closed, reports CNN.
In a statement posted late Friday on the Tesla Blog, Musk wrote: “I knew the process of going private would be challenging, but it’s clear that it would be even more time-consuming and distracting than initially anticipated.” And “although the majority of shareholders I spoke to said they would remain with Tesla if we went private, the sentiment, in a nutshell, was ‘please don’t do this.'”
After explaining he had met with investment firms Silver Lake, Goldman Sachs, and Morgan Stanley, Musk said his initial assessment that the funding was available was “reinforced.” However, Musk says he considered all the factors. “I met with Tesla’s board of directors yesterday and let them know that I believe the better path is for Tesla to remain public.”
A very brief second statement was issued by six of Tesla’s directors saying the special committee established to look into the feasibility of going private has now been dissolved; the statement also voices the board’s “[full] support” for Musk.
In his statement Friday, Musk thanked “all of our investors, customers, and employees for the support you’ve given our company. I’m incredibly excited to continue leading Tesla as a public company. It is a privilege.”
