Tesla board confirms it will consider Musk's privatization plan

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Musk said that he was considering taking the loss-making electric carmaker private at $420 a share, which would value a deal at more than $70 billion. Being public also subjects us to the quarterly earnings cycle that puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long term.

Mr Musk said in his tweet on Tuesday that shareholders would be offered $420 (£326) per share, valuing the business at more than $70bn.

Elon Musk has faced a barrage of criticism recently and his electric vehicle company Tesla has been taking a pounding from critics.

In a statement on Tesla's website on Wednesday, six of Tesla's nine directors said the board had met several times over the last week to discuss such an idea and was "taking the appropriate next steps to evaluate this". The company declined to comment beyond pointing to an all-employee email sent Tuesday by Musk. The move would also have little effect on Musk's current stake in the company, which rests at about 20 percent in current publicly traded form. "That sense of the market, investors-so critical for a company like Ford".

Musk's tweets caused a flurry of activity in financial markets.

An acquisition of Palo Alto, California-based Tesla by overseas investors would likely trigger a national-security review by the Committee on Foreign Investment in the U.S. The panel, which has stepped up its scrutiny and blocked some deals lately, could impose conditions, including limits on control of the company and information sharing.

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'Basically, I'm trying to accomplish an outcome where Tesla can operate at its best, free from as much distraction and short-term thinking as possible, ' Musk wrote.

If the content of Musk's tweet was not true, lawyers argue, it could expose Tesla's mercurial chief executive officer and the company to regulatory action and private lawsuits.

"This proposal to go private would ultimately be finalized through a vote of our shareholders", Musk said in explaining the potential move.

The statement by the board, published by NASDAQ, confirms that the proposal is under serious consideration.

FILE PHOTO: Elon Musk, founder, CEO and lead designer at SpaceX and co-founder of Tesla, speaks at the International Space Station Research and Development Conference in Washington, U.S., July 19, 2017. Tesla is a legendary cash-burner, with roughly $10 billion in debts and $2 billion in reserves, and Musk would probably need in the tens of billions of dollars to buy out shareholders at the right price.

"What does Musk mean by 'funding secured?"' asked Toni Sacconaghi, an analyst at Bernstein who has always been bearish on Tesla shares.

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