After more than two weeks of discussions, Tesla CEO Elon Musk says feedback from shareholders and experts has convinced him that “the better path is for Tesla to remain public” rather than becoming privately held.
Musk stirred up the financial world on Aug. 7 when he said he was considering a plan to buy up the electric car company’s publicly traded shares at a premium price of $420 a share. A major source of controversy was Musk’s claim that funding had already been secured for what could have been a multibillion-dollar stock purchase program.
The “funding secured” tweet drew skepticism from stock analysts and heightened scrutiny from federal regulators.
In tonight’s update to Tesla’s website, Musk said that most of Tesla’s existing shareholders wanted the company to remain public, and that going private could have forced some institutional investors to divest their stakes. Retail investors might have been forced to sell their stock due to limits on the number of shareholders allowed for a privately held company.
“The sentiment, in a nutshell, was ‘please don’t do this,’ ” Musk wrote.