Are you a business or investing publication if you don’t find a way to mention Elon Musk these days? We’re taking a slightly different tact this week – no Twitter. Instead, some text messages recently revealed in a court case cast light on the famous “funding secured” saga of 2018 – when Elon claimed he had secured funding from Saudi Arabia to take Tesla private (i.e. buy out all public shareholders) at $420 a share.
Side note: A lot of Elon’s texts are getting revealed these days. This week we also saw a text message exchange between Elon and Bill Gates get leaked.
These texts were first revealed as part of a shareholder lawsuit over the 2018 tweet. It includes Elon claiming the Saudi Public Investment Fund was “throwing me under the bus” after the Saudi’s did not fully support Elon’s claim that he had secured the funding.
While Elon tells the Saudi’s he plans to continue with privatisation plans by partnering with Silver Lake, a private equity firm, and Goldman Sachs, that plan obviously didn’t eventuate. In hindsight, Elon and his shareholders should be thankful he didn’t take Tesla private. The Tesla share price is up 10 times from the $420 a share price he was proposing in 2018 (factoring in a five-for-one stock split in 2020). However, a group of shareholders are still suing, claiming the volatility his tweets caused led to them losing money.
The case continues, and ultimately will not materially impact Tesla’s long term prospects. However, it is an interesting look at how the world’s wealthiest person tried to save a multi-billion dollar deal over text message.
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