Elon Musk recently announced he is considering taking Tesla private

Investor's Corner					Tesla board to formally review Elon Musk’s plan to go private TSLA reacts after hours

Investor's Corner Tesla board to formally review Elon Musk’s plan to go private TSLA reacts after hours

The reference to the company's stock is particularly relevant because Tesla shares immediately skyrocketed in the wake of Musk's tweet.

If the plans come to fruition, Tesla will set up a special investment fund to enable existing minority shareholders to hold their shares after privatization.

If Tesla goes private, there will be some shareholders who aren't happy because of the loss of liquidity compared with that of stock traded daily on a exchange like the Nasdaq Stock Market, Coffee said. It was also discovered that Saudi Arabia's Public Investment Fund (PIF) had a acquired a sizable stake in Tesla in a series of open market transactions through JPMorgan. They said he had "addressed the funding for this to occur", without providing details.

The six members said the Board has "met several times over the last week and is taking the appropriate next steps to evaluate this".

Musk said in his initial tweet that he had secured financing but has not given any evidence of that. The current value of Tesla's shares stands at around $370 so a buyout at $420 would represent a roughly 20% premium at buyout, a defiantly tempting offer to get shareholders to sell their shares.

Some Wall Street analysts were skeptical of Musk's ability to gather the huge financial backing to complete such a deal, given that Tesla loses money, has $10.9 billion of debt and its bonds are rated junk by credit ratings agencies.

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The SEC declined to comment on Musk's Tuesday tweet and possible future actions against him or Tesla.

Over the past few weeks and months, Tesla and more specifically CEO of Tesla Elon Musk have been in the news quite a fair bit, and a good amount of that press hasn't been exactly positive.

But "if no firmer details emerge", he wrote in a report to clients, "investors would likely increasingly debate Musk's credibility and seemingly unhealthy focus on the shares' price and volatility". Musk has feuded publicly with regulators, critics, short sellers and reporters, and some analysts suggested that less transparency would be welcomed by Musk. This was reported by Elon Musk in his twitter handle.

One of the biggest questions surrounding the buyout is Tesla's long history of losing money while it has been investing in electric auto technology and ramping up production of its vehicles.

Some on Wall Street shared that view.

Buying Tesla in its entirety would cost $72 billion, based on the company's outstanding stock as of July 27. Musk previously said that the company would hit that number by the end of 2017 and that sustaining such a production rate is critical for Tesla to become profitable. He also emphasised on removal of the quarterly system cycle by taking tesla into private company since this quarter cycle could affect tesla's decision making between any of the quarters.

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