Elon Musk considering taking Tesla private, TSLA stock trading halted

Elon Musk considering taking Tesla private, TSLA stock trading halted

Tesla shares were halted from trading at $367.25 Dollars per share shortly after 2:00 pm for more than an hour after Musk's tweets.

Mr Musk's announcement was initially met with widespread scepticism, with many people connecting the proposed price to 420 being a common slang term for marijuana.

Tesla's CEO also laid out what he envisions as the ideal path for going private.

Tesla shareholder Quint Tatro, managing director of Joule Financial, praised the idea as "brilliant", adding that "Musk is exhausted of dealing with all the challenges of being 'public'".

Making money has proven elusive for Tesla while it has been investing in electric auto technology and ramping up production of its vehicles, including a sedan with a starting price of $US35,000 to appeal to a broader audience.

Shares have rallied strongly since those earnings, but Musk has continued to show a short fuse towards critics, lambasting "short" sellers of Tesla shares - those who take bets that the stock will fall in value.

Elon shared that the move to take Tesla private would insulate the company from the rampant influence of bulls and the bears on the direction the company moves.

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The company's shares were up more than 5 percent at more than $360.

He also said that he would hold on to his almost 20% stake in the company if it were taken private, and that he wouldn't expect himself or any other investor to have a controlling vote after the buyout. That would put pressure on Tesla while it continues to burn cash, as of the second quarter.

Palo Alto-based Tesla, named after the physicist Nikola Tesla, went public in 2010.

Musk has been under intense pressure this year to prove he can deliver on his promise to turn his money-losing company into a profitable higher-volume manufacturer, a goal that has propped up Tesla shares and resulted in a market value higher than that of General Motors Co. The tweets came not long after a report that Saudi Arabia's sovereign wealth fund has built a $2 billion stake in Tesla. On the other hand, many of Tesla's most passionate backers bought stock because they believe the price will eventually go to stratospheric levels. He added that in the future, when Tesla reached a "phase of slower, more predictable growth", the firm could go public again. They'll have an option to sell at $420 per share or to hold onto their shares and become shareholders of the new private company.

It is probably worth mentioning that at the time of writing (Aug. 7, 2018, 4:30 pm EDT), Musk is $1.5 billion richer than he was 5pm EDT just the day before.

Elon Musk is the world's 31st-richest person and Tesla's largest shareholder.

"This has nothing to do with accumulating control for myself", Musk said in the Tuesday email.

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