Musk explains why he thinks taking Tesla private is 'best path forward'

Elon Musk at a Tesla

Elon Musk at a Tesla

Tesla CEO Elon Musk, in true Elon Musk fashion, took to Twitter to think out loud about his electric vehicle business.

Tesla shareholders would need to vote in favor of going private before the decision is finalized, Musk concluded.

No matter if he was joking or not, as soon as Musk tweeted about this, the stock spiked.

The two pieces of news helped move shares of Tesla up almost 6% in trading Tuesday, to $362 apiece.

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.

Musk's other companies specializing in private spaceflight and underground supertrains - SpaceX and The Boring Company - remain private, and Musk has shown reluctance about opening them to the public markets.

That said, if they do want out, they can sell their shares at $420 per share, which is a fair bit higher than Tesla's current stock price ($382.67 at the time of writing, up from today's open price of $343.84).

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

George Galliers of Evercore ISI said he believed the tweet was serious.

The surprise announcements prompted former Securities and Exchange Commission Chairman Harvey Pitt to question whether Musk had broken securities laws.

The firm's shares climbed more than 6% after the tweet, but the Nasdaq later halted trading pending an announcement.

Musk originally brought Tesla public in 2010 to help raise funds for the company's growth.

Elon Musk said he's thinking about taking Tesla private. "The 16 per cent premium to the current share price may not be high enough to incentivise existing shareholders to support the sale".

This is especially true for a company like Tesla that has a long-term, forward-looking mission.

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

But asked if he would take legal action against Musk over the allegation, Unsworth said: 'If it's what I think it is yes'. He added: "I can't believe this is something to bluff or make fun of".

"Tesla's volatility makes it more of a trading stock than a value play", said Ihor Dusaniwsky, head of research at S3 in NY.

Tesla did not immediately respond to a request for clarification.

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