Photo : AP Investors may be wondering what Elon is smoking this afternoon following a tweet in which he claimed he’s considering taking Tesla private at $420 per share. What seemed like a joke at first may be serious and as the company’s stock price went crazy, trading has been halted. Advertisement Musk’s tweet came almost simultaneously with a new report from the Financial Times that revealed for the first time that Saudi Arabia’s Public Investment Fund has been quietly buying up about five percent of the electric car company over the last few months to the tune of $2 billion. It’s unclear if Musk’s tweet, the new report, or the two items’ powers combined were responsible for the Tesla stock pop but shares in the company shot up as much as 7.3 percent. Because 420 is the universal number indicating it’s time to smoke some weed, it was easy to laugh off Musk’s tweet as just one of his weird jokes. But after he called a hero diver who rescued children from a cave in Thailand a pedophile and seemingly meant it, it’s best not to assume the CEO is joking. And since his tweet, he’s elaborated on the idea and shared a blog post explaining that he’s quite serious. In the post, Musk said that he feels a forward-looking company like Tesla is better off being private and avoiding the short-term thinking involved with public markets. “I fundamentally believe that we are at our best when everyone is focused on executing, when we can remain focused on our long-term mission, and when there are not perverse incentives for people to try to harm what we’re all trying to achieve,” he wrote. He also emphasized that he hopes all shareholders decide to stay in for the ride and the proposal will ultimately be put to a vote. Around 2pm ET on Tuesday, trading of Tesla shares was halted for “pending news.” About an hour and a half later trading resumed and rose by more than 11 percent. Advertisement Some people on Twitter immediately began speculating that Musk may have wandered into a potential regulatory violation with his tweet. A spokesperson for the SEC declined to comment when reached by Gizmodo. But former SEC chair Harvey Pitt told CNBC that Musk’s out-of-the-blue tweet is “highly unprecedented... and raises significant questions about what his intent was.” The SEC has brought charges in the past in at least one case in which a man was accused of manipulating stock prices with false tweets and taking advantage of the reduced prices. Officially, the SEC is fine with financial announcements on social media as long as investors are alerted to which platform they should be keeping an eye on and that no investors are given an advantage to receive the information first. In Musk’s case, it’s arguable that all investors know to be watching his tweets every second of the day. Advertisement Marketwatch currently lists Telsa’s market cap at a little over $58 billion. Factoring in $8.8 billion in debt, Musk’s ganja-friendly target price to go private would value the company at around $80 billion. Bloomberg reports that if Musk managed to scrape together the cash to go private, it would be the largest leveraged buyout in history. Advertisement It appears that Musk is hopeful that shareholders will simply hang in for the ride and willingly go private. Blaze it.<doc-sep>Twitter has come under fire in recent months from everyone from Seth Rogen to journalists for refusing to intervene in the spreading of misinformation and propaganda by alt-Right accounts on one side, and “shadow banning” certain political views on the other. But the platform has come to the rescue of the internet’s friendly, neighborhood billionaire, Elon Musk. Twitter users began discovering over the weekend that simply using Musk’s name in your public name results in a locked account. Why would one of the most powerful social media corporations crack down on one seemingly insignificant issue afflicting one very powerful person? The official reasoning is that Twitter wants to combat spam and malicious activity, and in the case of Musk, there are bots who use his name and reply to his tweets trying to scam followers into buying fake cryptocurrency. Which, to be fair, has been observed by Musk fans and detractors alike. But there are bots everywhere on Twitter, not just in Musk’s replies. Another possibility is that Twitter wanted to address the hilarious parody account plaguing Musk. It’s not too much of a logical leap to wonder if this is really about Italian Elon Musk and its many copycats. If you haven’t run across fake Elon Musks on your timeline, you may not recognize the, ahem, severity, of Musk’s parody problem. The Musk meme began with Alex Arbuckle, a formerly verified Twitter user who renamed his account “Italian Elon Musk” and tweeted some pretty humorous gems before getting stripped of his blue checkmark. The following are a few tweets Musk may have seen and taken offense with: Of course, it was probably more amusing for most when Arbuckle’s profile was a badly photoshopped picture of Musk with some stereotypical Italian objects, and his name was literally “Italian Elon Musk,” but you get the point. Italian Elon Musk. Twitter Arbuckle returned to his regularly scheduled comedy posts, but another brave warrior picked up the torch with French Élon Musque, which seemingly tricks Twitter’s Musk name recognition system. The teen behind the parody account tweeted voraciously for a bit, but is now losing steam. The problem with Twitter’s move to ban Musk impersonators is two-fold: one, it’s a seemingly insignificant problem whose solution requires questionable limitations on speech, and two, it’s going to be impossible to continually execute. The parody accounts that have survived all have workarounds, like adding extra letters and accent marks. Fortunately, internet historians have the trusty screenshot to preserve this online moment of Musk roasting until our hard drives turn to dust and the cloud dissipates.<doc-sep>Elon Musk said on Twitter today that he is “considering” taking Tesla private “at $420,” and that he has secured the funding to do so. In a follow up email sent to Tesla employees, Musk indicated that the tweet was serious, and not just a weed joke. “The reason for doing this is all about creating the environment for Tesla to operate best,” Musk wrote. Details of how Musk would take Tesla private remain murky. Musk said he would make an offer to buy out Tesla stock at $420 per share. But he also said that shareholders would have a choice whether to sell at that price or remain with the company as it went private. Taking the company private would require a shareholder vote, he said. Tesla shares opened just below $344 today but have spiked following a report about Saudi Arabia taking a stake in the company worth $2 billion or more. An hour after Musk’s initial tweet, trading of Tesla shares was halted. They resumed again about two hours later, with its stock briefly soaring past $380. Am considering taking Tesla private at $420. Funding secured. — Elon Musk (@elonmusk) August 7, 2018 If Musk were to take Tesla private, he would need a huge amount of cash to do so — more than $50 billion, according to Bloomberg, reportedly making it “the largest leveraged buyout in history.” Musk indicated in two tweets that he has the necessary funding. However he’s yet to state where it’s coming from, and major Wall Street banks seemed to be unsure as well, according to CNBC. In his email, Musk said taking Tesla private would insulate the company from the “enormous pressure” of the quarterly earnings cycle, which he doesn’t believe fits with the company’s “long-term, forward-looking mission.” He also said going private would allow the company to avoid issues with short sellers who would profit off Tesla’s failure and “have the incentive to attack the company.” “Only reason why this is not certain is that it’s contingent on a shareholder vote.” Musk said that he currently owns about a 20 percent stake in Tesla and that he wouldn’t sell as part of the buyout. He would remain CEO after going private, Musk wrote, and he doesn’t believe the change will result in him holding substantially more of the company afterward. However, Musk already has an outsized amount of control over the company, despite not holding a majority stake. As TheStreet reported earlier this year, Tesla has supermajority requirements on major votes, which means nearly all outside investors have to vote against Musk to win out in a dispute. Once Tesla has “slower, more predictable growth,” Musk wrote, it “will likely make sense” to bring the company public again. Musk didn’t provide a timeline for when an offer would formally be proposed. And in his email, he wrote that “a final decision has not yet been made.” But he wrote that he expects the process to end with a private Tesla. In recent months, Musk has been in a heated debate with short sellers who believe that Tesla will ultimately fail, even going so far as to supposedly call an anonymous investment blogger’s boss to get them fired. As a public company, Tesla’s continued struggles to produce vehicles and make a profit have been watched closely, even as Musk continues to promise eventual turnarounds — like what happened with the Model 3. Buying out the company and going private would allow Tesla to stay out of the public eye as it deals with these growing pains. At least, to the extent that Musk could ever allow himself or his company to fall out of the headlines.<doc-sep>
When the kush hits. Photo: Mark Brake/Getty Images This afternoon, the elite brain genius Elon Musk tweeted out an idea. Am considering taking Tesla private at $420. Funding secured. — Elon Musk (@elonmusk) August 7, 2018 Shareholders could either to sell at 420 or hold shares & go private — Elon Musk (@elonmusk) August 7, 2018 Is it a joke? Was he serious? Nobody has any idea. Here’s the reason it might be a joke: 420 is the weed number; blaze it. Here’s why it might not be a joke: $420 per share would be the highest that Tesla stock has ever gone, meaning that setting that number as the goal would push Tesla’s market cap to record size. A spokesperson for Tesla told the Financial Times that it “could not confirm whether the tweet indicated a serious intention to privatise the company.” If Musk is serious, his tweet could be seen as an illegal manipulation of the market, triggering an inquiry by the SEC and some sort of penalty. Trading of Tesla shares was halted in the meantime, but not before their price rose 10 percent, to about $380. CNBC’s Alex Sherman tweeted, “I’ve been on the phone with a handful of people in the past 20 min who think they should be in a position to know if Elon Musk has secured $70b+ in financing, and so far, no one has a clue.” It looks like, once again, Elon Musk said something outlandish on Twitter and got everyone’s attention. A few weeks ago, a rescue diver criticized the boy canister that Musk hastily invented to rescue a group trapped in a cave in Thailand, and Musk retaliated by accusing him of being a pedophile. Seeking to legitimize his odd announcement, Musk was forced to write an entire blog post. First, a final decision has not yet been made, but the reason for doing this is all about creating the environment for Tesla to operate best. 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. 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. Finally, as the most shorted stock in the history of the stock market, being public means that there are large numbers of people who have the incentive to attack the company. Musk said that, ultimately, it would come down to a shareholder vote in deciding whether the company would go private. “Either way, the future is very bright and we’ll keep fighting to achieve our mission,” he concluded. A busy day for Elon, maybe he should find a way to … relax. It’s 4:20 somewhere.