Tesla CEO Elon Musk is apparently thinking about taking the company private, he said in a Tweet this morning. More specifically, he said he may buy back the company for $71.3 billion (at a share price of $420).
I’ve reached out to Tesla — given that this could just be Musk trolling all of us — and will update this story if I hear back.
Musk’s tweet came shortly after news broke that a Saudi Arabian sovereign wealth fund bought a $2 billion stake in Tesla. Tesla’s stock is currently rallying. It jumped as high as $371 and is currently trading around $359.
Update: Musk has since tweeted that he doesn’t have a controlling vote and “wouldn’t expect any shareholder to have one if we go private.”
Whether this is appropriate disclosure under SEC rules is unclear, but it’s worth noting that it does allow companies to make certain announcements in specific circumstances on social media. The caveat is that investors must know to watch those channels for those announcements.
Back in 2012, Netflix CEO Reed Hastings announced Netflix subscribers passed one billion hours of content watched. The following year, the SEC announced that was ok to do and that Hastings did not violate Regulation Fair Disclosure, which requires companies to distribute information regarding their financial success in ways that are widely accessible.
Musk has a following of 22.3 million people on Twitter, while Hastings had just over 200,000 followers on Facebook at the time of his announcement. That’s just to say I could see how one could argue Musk has a large enough reach to not be in violation of Regulation FD. But, I’m also not the SEC, which was not available for comment at the time of publication.
Tesla’s stock has been rather volatile in the last year, trading as low as $244.59 in April and as high as $389.61 in September.
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