SEC ramps up its investigation into Elon Musk's Tesla privatization plans

Daniel Fowler
August 18, 2018

Yet again, the SEC declined to comment.

He tweeted that he planned take the electric auto maker private at $420 a share, valuing the company around $72 billlion, a 20 per cent premium on the share price that day - and crucially said he had the "funding in place". Musk tweeted earlier this week that he was working with Goldman and the private equity firm Silver Lake.

A Wall Street Journal story published after the stock market closed said the subpoena sought information from each of Tesla's directors.

Elon Musk's itchy fingers appear to have landed him in hot water once again, after posting a Tweet saying he was considering taking Tesla private.

The subpoena signals regulators have now opened a formal investigation into whether Musk was telling the truth in his tweet. The report cites "a person familiar with the matter". The shares are falling Wednesday, down 3 percent, as worries mount about an SEC investigation into the statement.

Tesla's board has since clarified that it hasn't received a formal proposal from Musk, who's also chairman, nor has it concluded whether going private would be advisable or feasible.

Shares in Tesla fell back slightly, down 3.1% to $336.63, in NY trading after investment bank Goldman Sachs said it would no longer provide research on the company because it is acting as its adviser.

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Musk on Monday explained in a blog post that his statements about financing were based on his conversations with Saudi Arabia's sovereign wealth fund and other investors.

Analysts estimated the deal would require up to US$50 billion.

A Tesla spokesperson told Engadget that those claims aren't true at all and that it has never used punctured cells in any Model 3 vehicles.

Tesla said the committee consists only of independent directors: Brad Buss, Robyn Denholm and Linda Johnson Rice.

Gene Munster, a managing partner at the venture-capital firm Loup Ventures, echoed that point in an interview with CNBC.

Banks claimed Musk was panicking over his tweet about taking Tesla private.

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