Musk says he might take Tesla off the stock market

Calling stock-market performance pressures a "distraction," Elon Musk said that he is considering taking Tesla private.
By Rick Docksai | Aug 09, 2018
Elon Musk shocked investors Tuesday with a tweet in which he said he is considering taking Tesla private. He confirmed the news in an email to Tesla employees that said that removing their company from the stock market would free them from "distraction" and " pressure" of news reports of Tesla's rocky stock performance, and thereby benefit employee morale.

In his tweet, Musk typed that he has "funding secured" for the move. He did not specify from where, however.

Many experts doubt that he can pull it off. They note that, withthe electric-car company currently valued at $82 billion, such a move would be the largest leveraged buyout in history.

"The market doesn't believe him," said David Kudla, the CEO of Mainstay Capital Management, which is betting against Tesla. "His credibility has come into question over a number of things. If this were real, you'd expect the stock to go closer to $420 a share than it has."

Gene Munster, managing partner at venture capital firm Loup Ventures, said that Musk has "a 1 in 3 chance that he can actually pull this off."

Tesla has been continuously losing profits for the past few years since going public. Investor confidence dipped even more heavily this year due to prolonged production backlogs of the new Tesla 3, and the company recorded hundreds of millions of dollars' worth of stock-market losses a week ago.

Musk's frustrations with Tesla's stock performance bubbles to the surface in May, when he said in a May conference call that if investors are worried about the volatility of Tesla's shares, they shouldn't own them.


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