Giant Saudi fund emerges as backer of bid for Elon Musk's Tesla

  • Giant Saudi fund emerges as backer of bid for Elon Musk's Tesla

Giant Saudi fund emerges as backer of bid for Elon Musk's Tesla

Tesla did not respond to a request for comment on the proposed class-action complaints filed in the federal court in San Francisco.

Tesla Inc and Chief Executive Elon Musk were sued twice on Friday by investors who said they fraudulently engineered a scheme to squeeze short-sellers, including through Musk's proposal to take the electric auto company private.

The amount of funding needed would depend on how many current investors want to remain part of the $60.9 billion company if it goes private. Musk said he had a July 31 meeting with representatives of the Saudi Arabia sovereign fund and left it "with no question" that a deal could be closed.

CEO Elon Musk's audacious plan to take the carmaker private is distracting dealmakers from a normally quiet August spent in the Hamptons or Southern France.

The company, which held talks with Musk in 2017 about a possible investment, isn't interested in revisiting such a plan, said the people, who asked not to be identified as the details aren't public.

Musk and advisers are seeking a wide pool of investors to back a potential deal.

The stock has since given back more than two-thirds of that gain, in part following reports that the U.S. Securities and Exchange Commission had begun inquiring about Musk's activity. The discussions failed to progress due to disagreements over ownership.

Tesla was reportedly courted by Japan's SoftBank in April of past year, though sources told Bloomberg on Monday that the conglomerate isn't planning to participate in deals for Tesla's buyout as it has already vested interest in other auto makers and autonomous vehicle programmes, like General Motors. The Saudi fund hasn't made any firm decisions on whether to increase its stake, or by how much, but talks are ongoing, they said. "As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla, all of whom are shareholders", Musk wrote, according to Forbes.

Wall Street is awash with speculation on who might team up with Musk to do a deal.

The SEC, which already had been gathering information about Tesla's public pronouncements on manufacturing goals and sales targets, is intensifying scrutiny of the company's statements in the wake of Musk's tweet, people familiar with the matter have said. He said the Saudi fund approached him multiple times about going private starting nearly two years ago and that he left a July. The government is planning to turn the PIF into a $2 trillion powerhouse to help diversify the kingdom's oil-dependent economy.