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Elon Musk says the Saudi fund wanted to take Tesla private

by SuperiorInvest

Elon Musk testified in federal court Monday that Saudi Arabia’s sovereign wealth fund “clearly wanted to take Tesla private” in a trial that centers on whether Mr. Musk’s 2018 remarks about pulling the carmaker off the stock market caused investors to come by billions. dollars.

A judge overseeing the case in San Francisco has already ruled that some of Mr. Musk’s statements about taking the company private were false — including his claim that he had secured financing for the deal.

The testimony about the Saudi Arabian fund, a public investment fund, came in response to questions from a plaintiff’s lawyer who pressed Mr. Musk, Tesla’s chief executive, for more details about the plan to take the company private. Mr Musk said officials of the Saudi fund had not signed documents committing to the deal and that they had not discussed how much they would invest in the deal.

“It would be impossible to know the exact amount without knowing who else will participate,” he said. But he added that he believes “when they say they’re going to do something, they do it.”

Delisting a public company can be expensive and difficult. People or investment firms who want to take a business private must raise money to buy all or most of its shares.

The Saudi fund, which amassed a 5 percent stake in Tesla before Musk announced his plans, would be an important part of any deal. Mr. Musk has long maintained that the Saudi investors were committed to the deal, and communications contained in court filings showed Mr. Musk criticized Saudi officials after reports suggested they were lukewarm on the deal.

Mr. Musk and Tesla’s legal team tried unsuccessfully to get the fund’s employees to testify in the trial. This month, lawyers for the fund called the subpoenas “legally deficient” and “frankly, frivolous.” A spokesman for the fund did not immediately respond to a request for comment on Monday.

On August 7, 2018, Mr. Musk he wrote on Twitter: “Considering taking over Tesla at $420. Funding secured.” So Mr. Musk he wrote: “Investor support is confirmed. The only reason it’s not certain is because it’s subject to a shareholder vote.” Tesla’s share price jumped after Mr Musk made the comments, but fell when the proposal came out.

Asked if he priced Tesla at $420 a share because it would be “a joke your girlfriend would like,” Mr Musk said: “There’s some karma around $420, although I should question whether it’s good or bad karma. direction.” Mr. Musk then added that he chose $420 because it was about 20 percent higher than Tesla’s share price at the time.

Wearing a dark suit and black surgical mask, Mr. Musk entered the courtroom and went straight to the witness stand. He watched the jurors as they walked in and nodded at them.

Lawyers for the investors argued that people made the decision to invest in Tesla because Mr. Musk said he had raised the funds needed to take Tesla private. But lawyers for Mr. Musk and Tesla said it’s possible investors made the decision based on Mr. Musk’s statement that he was considering taking Tesla private — a statement his lawyers say was true.

Legal experts said most companies and CEOs would likely settle such a case. But Mr. Musk has often shown a willingness to let the lawsuits filed against him and Tesla go to trial.

While on the witness stand on Friday, Mr. Musk acknowledged that his Twitter account provides important information about Tesla and that it must follow Securities and Exchange Commission rules. However, he denied that his social media posts were responsible for fluctuations in Tesla’s stock price. He also said he couldn’t be as comprehensive on Twitter as Tesla could be in SEC filings and press releases.

Mr. Musk also said that his friends, as well as Tesla executives and investors, suggested he take a break from Twitter before writing about taking Tesla private.

In 2018, Mr. Musk and Tesla settled a separate lawsuit with the SEC over his proposal to take Tesla private. They paid the SEC fines and Mr. Musk agreed to step down as Tesla chairman and allow a lawyer to review certain statements about the company before posting them on social media.

The trial began three months after Mr. Musk acquired Twitter. It has since fired most of its staff, changed its content rules, and allowed previously banned or suspended users back onto the platform.

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