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Analysts Question Tesla’s Ability to Go Private
CEO Elon Musk’s cavalier nine-word tweet yesterday declaring that Tesla Inc. might be privatized has prompted questions about how the company would pull off the $70 billion deal.
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CEO Elon Musk’s cavalier nine-word tweet yesterday declaring that Tesla Inc. might be privatized has prompted questions about how the company would pull off the $70 billion deal.
Earlier today six Tesla board members said Musk had raised the question of taking the company private last week. They also say the board has met several times since then and is taking appropriate steps to “evaluate” the idea.
Musk’s tweet claims the necessary funding has been secured to delist the company at $420 per share. But neither he nor Tesla’s board has provided any details. Some observers say Musk could face securities fraud charges if the necessary funds haven’t actually been committed yet.
Skeptics wonder why an investor would want to plow billions into a company that has burned through $3.5 billion in cash over the past 12 months and must spend billions more in the next few years to execute its growth plan.
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