Elon Musk explains why he's thinking about taking Tesla public

Elon Musk considers taking Tesla private as stock jumps

Elon Musk shook both the Internet and financial industry Tuesday as the man in charge of Tesla [NYSE: TSLA] tweeted about taking Tesla private and buying back the stock at $420 per share.

Upon the news, Tesla stock quickly shot up to $365, climbing toward $420 - the amount Musk noted would be the trigger price. The company had a market value of $58bn as of Monday's close.

Technology dynamo Elon Musk announced Tuesday that he may take Tesla private, sending the Internet into a spiral of speculation about whether he was actually legit.

A deal at $420 per share represents a 22.8 percent premium to Tesla's closing price on Monday, valuing the company at about $72 billion.

Earlier Tuesday, the Financial Times reported that Saudi Arabia's sovereign wealth fund has bought as much as 5 percent of the company's shares - making it one of Tesla's biggest shareholders.

He said he was thinking about taking the electric vehicle company private, and already had the funding lined up.

Shares of Tesla closed up 11% after being briefly halted in trading by the Nasdaq to release the letter.

Following the company's surge after last week's earnings, Musk took aim again at a short-seller in a reposted short YouTube video that likened these investors to Hitler's last days.

If Musk decides against going private, Gordon said his credibility could take another hit, though one he could weather. On Sunday, he Tweeted a link to a parody of a movie about Adolf Hitler aimed at short-sellers, writing, "Dang, turns out even Hitler was shorting Tesla stock".

Tesla did not immediately confirm if Musk himself sent the tweet or if it was the result of a hack. ("Yes", Musk replied.) He expressed hope that current investors would stay with the company, later adding that shareholders could either "sell at [$420] or hold shares & go private".

Musk claimed on his personal Twitter account to have secured funding for the maneuver, estimating the per-share valuation of the possible transition at $420.

Now the question is, is this a similar move, taking the pressure off the public performance that Musk disdains each quarter, combined with some hubris over decimating the multitude of short positions.

Musk said in subsequent tweets that he would remain chief executive under a go-private transaction and that any deal would benefit shareholders.

Mr Musk has had feuds with regulators, critics and reporters, and questions remain about Tesla's production and manufacturing difficulties, long-term demand for its cars and uncertainty over funding. I think he's serious.

Tesla lost US$717-million in the second quarter, its largest quarterly loss.

As the matter unfolds, some are questioning whether or not the tweets are authentic.

Tesla shares jumped more than 7 per cent to $US367.25 ($A494.94) before halting for news pending.

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