Elon Musk announces to take Tesla private to ease losses

ABU DHABI: Tesla Inc. is that one company known for taking radical decisions at crucial times. However, the CEO, Elon Musk, is the person who is a big reason behind what the company is today. Adding on to the number of aggressive decisions that he has taken in his life, the CEO has announced yet another ambitious decision at which the entire world was taken aback.

 

Citing the reason to ease and curb financial losses, Elon Musk has announced that the Tesla Inc will go private. This radical decision has shocked all the investors around the world. This major announcement was made on Twitter.

Currently, each of the shares of Tesla Inc. costs $420. However, at the moment, the company’s estimated value is somewhere around $82 billion, which includes all of the debts as well. As of now, the CEO himself owns 20% of the total stake in the company.

Elon Musk has mailed all of his employees in which he wrote that the reason why he is taking this huge step on behalf of the company is its welfare. It is to create the best possible environment for Tesla as a whole. Moreover, the wild swings in the stock prices and market evaluations can be major distractions for all the workers, besides putting huge pressure on the company to make decisions that may not be very right for the long terms.

Interestingly, Saudi Arabia holds around 5% stake in Tesla Inc., which can amount to around $2 billion. As a part of the Vision 2030 of the UAE, Saudi Arabia’s PIF (Public Investment Fund) has acquired some shares for the company in order to widen the financial strategy and diversify the revenue which is otherwise stuck on to oil.

Now the question that arises here is, how will Elon Musk manage to raise the remaining $66 billion to complete the transaction?