Though Musk initially believed taking Tesla private would allow the company to have better long-term sustainability, allowing it to focus on making great electric vehicles instead of answering to Wall Street every quarter for missing production schedules, he’s now changed his mind.
Musk shared his three main reasons for keeping Tesla a publicly traded company:
• Given the feedback I’ve received, it’s apparent that most of Tesla’s existing shareholders believe we are better off as a public company. Additionally, a number of institutional shareholders have explained that they have internal compliance issues that limit how much they can invest in a private company. There is also no proven path for most retail investors to own shares if we were private. Although the majority of shareholders I spoke to said they would remain with Tesla if we went private, the sentiment, in a nutshell, was “please don’t do this.”
• I knew the process of going private would be challenging, but it’s clear that it would be even more time-consuming and distracting than initially anticipated. This is a problem because we absolutely must stay focused on ramping Model 3 and becoming profitable. We will not achieve our mission of advancing sustainable energy unless we are also financially sustainable.
• That said, my belief that there is more than enough funding to take Tesla private was reinforced during this process.
Musk’s troubles first started when he tweeted out earlier this month that he was considering taking Tesla private when the stock price hit $420 (a possible weed joke, but who knows?!) and that funding was secured.
Elon Musk
✔@elonmusk
Am considering taking Tesla private at $420. Funding secured.
