Elon Musk says Saudi Arabia could finance bid to take Tesla private

Elon Musk speaks at a news conference

Tesla (TSLA.O) Chief Executive Elon Musk said on Monday he was still in talks with potential backers of a possible buyout of the company, including Saudi Arabia's sovereign wealth fund, but had not completed securing the funding.

That meeting inspired Musk's "funding secured" tweet last week that said he was "considering taking Tesla private" at $420 a share, he wrote.

Going back nearly two years, the Saudi Arabian sovereign wealth fund has approached me multiple times about taking Tesla private. Musk and his advisers are seeking a wide pool of investors to back a potential take-private of the automaker to avoid concentrating ownership among a few new large holders, according to people familiar with the matter.

"My best estimate right now is that approximately two-thirds of shares owned by all current investors would roll over into a private Tesla".

He wrote that in the blog and the August 7 tweet that he was speaking for himself as a potential bidder for the company.

The U.S. Securities and Exchange Commission, which has been gathering information about Tesla's public pronouncements on manufacturing goals and sales targets, is intensifying its scrutiny of the company's public statements in the wake of Musk's tweet, people familiar with the matter have said.

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His comments in which he said he is considering taking the green vehicle maker private for $420 a share shocked Wall Street and sent Tesla stock surging. Beyond amassing a stake of just below 5 percent in Tesla, the sovereign wealth fund has poured tens of billions of dollars into technology investments, including $45 billion in SoftBank Group Corp's Vision Fund over five years.

Bloomberg reported on Sunday that PIF is in talks that could see it become a significant investor in Tesla as part of the take-private plan but has made no firm decision, citing people with knowledge of the fund's plans.

Elon Musk stunned investors last week with his tweet. During the meeting, the Managing Director of the fund expressed regret that I had not moved forward previously on a going private transaction with them, and he strongly expressed his support for funding a going private transaction for Tesla at this time.

Musk also wrote that the Saudis are interested in the company because they want to diversify away from oil.

What are the next steps? While the entrepreneur owns 20 per cent of Tesla, more than US$60 billion would be needed to buy the business from public shareholders. If the board process results in an approved plan, any required regulatory approvals will need to be obtained and the plan will be presented to Tesla shareholders for a vote.

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