After initially providing no details on the potential sources of the funding that would be needed to complete a privatization deal, Musk said Monday Saudi Arabia is the mystery backer behind a potential deal.
“Recently, after the Saudi [Arabian sovereign wealth] fund bought almost 5% of Tesla stock through the public markets, they reached out to ask for another meeting,” Musk said in the post. “During the meeting, the Managing Director of the fund expressed regret that I had not moved forward previously on a going private transaction with them, and he strongly expressed his support for funding a going private transaction for Tesla at this time.”
Musk said he then notified the Tesla board of directors who advised him to discuss the offer with Tesla’s largest shareholders. Musk said he tweeted about the deal publicly to allow those private discussions with top investors to take place without providing preferential treatment to large investors.
Why It’s Important
Since Musk’s cryptic tweets of "funding secured," Wall Street has been highly critical of the potential deal and questioned the source of the funding necessary to complete it. Now that Musk has shed some light on the situation, analysts and investors have more of the information needed to value its potential impact on Tesla stock.
Investors will be watching for further updates about the details of the plan as well as whether or not Tesla’s largest shareholders are receptive to the deal.
Tesla's stock hit an intra-day high of $361.59 shortly after Monday's opening bell, but was trading around $356.56 at time of publication.
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