Trading in Tesla stock suspended after Musk tweet on going private

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Trading in Tesla stock suspended after Musk tweet on going private

Musk is Tesla's largest shareholder, with an approximately 20 percent stake valued at about $12 billion, according to S&P Capital IQ.

"As the most shorted stock in the history of the stock market, being public means that there are large numbers of people who have the incentive to attack the company", Musk said. Musk's offer is 9 percent higher than Tesla's peak closing price of $385 reached almost a year ago.

Munster predicted a one-in-three chance that Musk will actually take Tesla private.

Musk's tweet came after an earlier report from the Financial Times that said Saudi Arabia's sovereign wealth fund bought a 3 to 5 percent stake in the electric vehicle maker, according to people with direct knowledge of the matter. The company says production is rising, with the goal of 6,000 per week by the end of August.

Shares were halted on the Nasdaq shortly after the story broke, citing "pending material news" from the company.

Musk has every incentive to try to either drive up the stock price or eliminate the need for public reporting on sales and finances by taking the company private.

While the decision isn't set in stone, Musk layout out a provisional plan to take the company private.

At $420 per share, a deal would represent a 23 percent premium to Tesla's closing price on Monday. On April Fool's Day, amid growing market concerns about Tesla's cash crunch, he had tweeted a fake news release that said Tesla would have to file for bankruptcy.

Tesla did not return repeated calls for comment from CNBC, nor did the Securities and Exchange Commission, as of this publishing. Beyond skyrocketing Tesla's valuation to over $70 billion at $420 a share, taking the company off of the public markets would relieve some of the pressures of having to report earnings and face volatility from traders, thus giving the company better financial footing.

He shared more details in a series of Twitter replies, noting that should Tesla go private, he'd remain in his role as founder and CEO of Tesla.

The first tweet came hours after the Financial Times reported that Saudi Arabia's sovereign wealth fund had built a significant stake in Tesla Inc., but it was unclear if that was the funding Musk was referring to.

Mr Musk has previously discussed the drawbacks of being a public company, saying shareholder demands often produce short-term thinking. I think he's serious.

Whether Musk's tweet was ethically proper or not, all of the experts interviewed by FOX Business agree the move was unprofessional at best.

He has also had a prickly relationship with Wall Street, apologising last week to equity analysts from major banks after cutting them off abruptly during the previous earnings conference call.

Musk said he wouldn't sell his stake if the company went private.

The proposal will have to be voted on by Tesla shareholder before it goes ahead.

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