By Ovunc Kutlu
NEW YORK (AA) – Saudi Arabia's sovereign wealth fund has enough capital to take Tesla private, CEO Elon Musk said Monday, responding to his tweet last week that said "Funding secured."
Musk said the fund approached him multiple times about taking Tesla private since early 2017 with the "need to diversify away from oil." He confirmed that it recently bought almost 5 percent of Tesla shares through public markets.
In a meeting with the fund July 31, Musk said the managing director "strongly expressed his support for funding a going private transaction for Tesla at this time."
Musk said last week Tesla operations would be "way smoother" and "less disruptive" if the company goes private, and stated Monday that privatization would be in Tesla's "long-term interest."
After meeting with the board, the CEO said he started engaging with large shareholders, but decided to inform all shareholders with his tweet last week saying it was "the right thing to do was [to] announce my intentions publicly."
Musk said he will complete discussions with Saudi Arabia before presenting a detailed proposal to an independent board committee before pacing the plan of privatization to shareholders for a vote.
He said he estimates around two-thirds of shares owned by all current investors would join Tesla if the company goes private.
Musk said last week he wants to take Tesla private at $420 per share.
Last Tuesday, he wrote on Twitter, "Am considering taking Tesla private at $420. Funding secured … Shareholders could either to sell at 420 or hold shares & go private … Will ensure their prosperity in any scenario."
The Financial Times reported that Saudi Arabia's Public Investment Fund, one of the biggest sovereign wealth funds in the world, acquired a stake of between 3 and 5 percent of Tesla shares this year.