Elon Musk defends decision to announce plans to take Tesla private
Oh, Elon.
The Tesla founder and CEO just released a statement defending his tweets last week announcing his consideration of taking the company private. It confirms that Saudi Arabia is providing the funding he'd like to use to take his company private.
"Recently, after the Saudi fund bought almost 5 percent of Tesla stock through the public markets, they reached out to ask for another meeting. That meeting took place on July 31," his statement reads.
"I left the July 31 meeting with no question that a deal with the Saudi sovereign fund could be closed, and that it was just a matter of getting the process moving. This is why I referred to 'funding secured' in the August 7 announcement."
His retelling of the events, however, only sound like a strong verbal agreement to help. Typically in these type of deals, there are letters of intent, contracts, and other official documents with signatures to make funding actually secured.
His original tweet said that he was "considering" taking his company private for $420 a share. But in doing so, he may have violated multiple federal securities laws. He was slapped with two class-action lawsuits over his online behavior: one of the suits claims he "artificially" helped the Tesla stocks to perform better and the other says his announcement misled investors.
"The only way I could have meaningful discussions with our largest shareholders was to be completely forthcoming with them about my desire to take the company private," reads his statement.
"As a result, it was clear to me that the right thing to do was announce my intentions publicly. To be clear, when I made the public announcement, just as with this blog post and all other discussions I have had on this topic, I am speaking for myself as a potential bidder for Tesla."
However he would like to defend himself, Musk is probably still going to face federal investigation by the Securities and Exchange Commission. The commission has pretty clear rules on how to treat investors and shareholders fairly, and it does not seem as though he's followed them.
Welp.
Maybe think twice before you tweet, Elon.
