Aug 26, 2018 - 06:59 pm

Tesla to remain listed on stock exchange

elon-musk

Tesla will not be taken private, says Tesla CEO Elon Musk who had planned to privatise the company. Rather than removing it from the stock market, it will now remain listed. Powerful investors had managed to change the mind of the Tesla CEO.

The discussion involved Tesla CEO Elon Musk, and major investors Silver Lake, Goldman Sachs and Morgan Stanley, who discussed the potential repercussions of taking Tesla private. As it looks, many of the longstanding investors would not be able to invest in a privatised Tesla due to internal regulation.

The board also opted to remain public, yet it was the reaction of the investors which convinced the CEO to let Tesla remain on the public market. In a blogpost, Elon Musk clarified the reasoning as follows.

“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 added that the process of privatisation would be very extensive and time-consuming. Time, that Tesla currently does not have. Particularly as the company is still working hard to solidify the production for the Model 3. Tesla aim to turn a profit from selling electric cars during the second half of 2018 for the first time.

autonews.com, insideevs.com, electrek.co, teslarati.com, tesla.com (blogpost)

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Found on electrive.com
https://www.electrive.com/2018/08/26/tesla-to-remain-public/
26.08.2018 18:02