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Musk tells court he lacked ‘specific’ funding to take Tesla private | Elon Musk

by News Desk
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Elon Musk expected strong financial backing when he tweeted in 2018 that he would take Tesla private, but testimony he gave during his third day of interrogation in San Francisco federal court showed a potential There was no concrete commitment from backers.

Musk has been accused of deceiving investors and driving up prices. Tesla It tweeted on August 7, 2018 that it had “secured funding” to take the electric car manufacturer private.

The case will test whether the world’s second-richest man can be held liable for his use of Twitter. Shareholders claiming losses have suffered millions of dollars in damages after Musk tweeted that “investor support has been confirmed” for the deal.

Tesla shares soared after Musk’s tweet and fell after it became clear the deal would not happen.

Musk told jurors on Tuesday that he could have used multiple sources of funding to take Tesla private, from existing shareholders like Oracle Corp co-founder Larry Ellison to Saudi sovereigns. to wealth funds or his own property.

“Funding was never an issue,” Musk said. “It was quite the opposite.”

But Mr. Musk has admitted he has no binding contracts with investors, leaving it up to a jury to decide whether he misled shareholders.

A nine-person jury will decide whether Tesla’s CEO artificially inflated the company’s stock price by touting the prospect of a buyout.

Responding to questions from his attorney, Alex Spiro, Musk said his tweet was meant to let investors know about their interest in taking Tesla private. Musk said Tesla’s board and Saudi Arabia’s sovereign have already discussed an interest in his Wealth fund and feared it would leak to the media.

“I had no bad motives,” he said. “My intention here was to do the right thing for our shareholders.”

The Saudi fund did not immediately respond to Reuters’ request for comment.

Musk told jurors that he had dropped the idea of ​​taking the company private after getting feedback from shareholders.

“I’ve spoken to a number of investors, especially smaller ones, and they said they would prefer Tesla to remain public, and I felt it was important to meet their expectations,” Musk said. testified.

The jury found board memos and documents days after Goldman Sachs, which worked with Musk on the proposed deal, tweeted that it had enough money to take the company private. was shown

Goldman Sachs did not immediately respond to a request for comment.

However, when questioned by the investor’s attorney, Nicholas Porritt, Musk said he did not have binding agreements for fundraising from interested parties.

Musk repeatedly resisted the yes or no answer Porritt asked for on discussions about funding commitments by the Saudi fund, and at one point urged the judge to cooperate with the question.

“A specific number was discussed?” the judge asked.

“It’s not a specific number,” Musk said.

On Monday, Musk said he could have funded He made the deal happen by selling his stake in SpaceX, the aerospace company he’s also CEO of. He also said he believed funding was pledged by the Saudi fund before they backed off.

the tweet is already $40 million settlement with securities regulators.

Musk stepped down as Tesla’s chairman after it became clear that no funds were available to take Tesla private, and remained CEO as part of the Securities and Exchange Commission settlement, although he was accused of cheating. I didn’t approve.

The trial is set to continue until next week, with testimony from Tesla’s board members and experts.

Reuters contributed to this report

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