Tesla Motors CEO Elon Musk at Tesla Store opening in Westfield Mall, London, Oct 2013
After Tesla CEO Elon Musk announced earlier this month that he planned to take the company private, investment advisors hooked a big fish to provide the funding, according to a report in The Wall Street Journal on Monday.
In a long report about the Tesla board’s deliberations over taking the company private, the Journal revealed that investment advisors from Goldman Sachs and Silver Lake had lined up $30 billion of financing for the privatization deal.
Two of the largest investors would have been Volkswagen and Silver Lake itself, sources familiar with the deal told the Journal.
Tesla declined to comment on the report.
Tesla Model 3 all-wheel drive Performance rolls off a new assembly line in a temporary structure
Musk’s tweet announcing that he planned to take the company private launched an SEC investigation into whether the effort was serious and whether the communication violated any securities laws.
In his original tweet, Musk said he had “funding secured,” and later revealed that statement was based on talks he held with the Saudi Arabian sovereign wealth fund about investing in Tesla. Later reports noted that the Saudi fund had not conducted any requisite due diligence into buying Tesla and may have been planning an investment in a rival startup electric automaker.
Musk’s announcement Friday that he would withdraw the proposal raised new speculation about the veracity of his original tweet.
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In Tesla’s early days, other automakers including Toyota and Daimler invested in the automaker.
According to the report, the new institutional investors would want greater control of the company. It also notes that Musk was deeply skeptical of rival car companies following the investments from Toyota and Daimler.
Volkswagen’s luxury brand, Audi, is planning to launch a new competitor to the Tesla Model X next month, and has plans to build five new electric cars by 2025.
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VW is also the only other company set to rival Tesla in building a network of fast chargers, after it was ordered to spend $2 billion to build a fast-charge network across America as part of its court settlement related to diesel emissions cheating.
In the end, Musk withdrew the plan to go private after advisers told him the new investments would come with conditions along with other considerations, the report says.
According to an open letter Musk wrote to shareholders on Friday, he worried that too many small investors would not be able to participate, and that current large Tesla institutional shareholders would have to sell their interests.
Tesla’s board published a parallel letter saying they supported Musk in his decision to keep the company public. The Wall Street Journal reports that sentiment ran deeper, noting that at least one board member cheered when Musk announced that he would withdraw the proposal to go private.