Tesla CEO Elon Musk took many of the company’s shareholders by surprise earlier this month when he tweeted that he’s considering taking the company private at $420 per share. He mentioned in the tweet that the funding for this transaction had been “secured.” Amid reports that Tesla was still in the process of locking down funding for the deal, Musk has now penned a detailed blog post to provide more details about the plan.

Musk wrote on the company’s corporate blog that the Saudi Arabian sovereign wealth fund has approached him multiple times about taking Tesla private “going back almost two years.”

They first met with him in 2017 to express their interest given the need to diversify away from oil, Musk writes. He added that more meetings were held over the next year to reiterate this interest and move forward with a possible transaction to take the company private.

A leveraged buyout is expected to cost around $70 and the Saudi sovereign fund has more than enough capital required for such a transaction. The fund is actually projected to reach $2 trillion in the coming months.

With nothing materializing, the Saudi fund purchased almost 5 percent of Tesla stock through the public markets. They then reached out for another meeting which took place on July 31st this year. Musk writes that 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.” That’s why Musk tweeted that the funding had been secured for the deal.

Before Tesla decides to ask shareholders to decide on going private, it will provide full details of the plan in addition to the proposed nature and the source of funding to be used. Musk is also having discussions with other investors as he wants the company to have a broad investor base.

He also commented on reports that over $70 billion will be required to take Tesla private. The $420 buyout price would be offered to Tesla shareholders who decide not to stay if the company goes private. “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 added.

Filed in Transportation. Read more about and . Source: tesla

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