Tesla boss Elon Musk has shocked the market with a bombshell tweet saying he is mulling taking the electric auto company private. He added that "being public means that there are large numbers of people who have the incentive to attack the company".
As a private company, Tesla would not be required to report quarterly results, freeing it from Wall Street pressure and giving the company a longer-term window to achieve Musk's goal of a renewable-energy future.
In this photo, taken September 29, 2015, Elon Musk, CEO of Tesla Motors Inc., talks about the Model X auto at the company's headquarters, in California.
All of this is compounded by the fact that today The Financial Times reported that Saudi Arabia wealth funds had bought up to a $2 billion stake in Tesla recently, so its feasible that Musk has secured funding from overseas interests.
Tesla stock was halted at $367.25 per share shortly after 2 p.m., before closing up 11 percent after resuming trade at 3:45 p.m.
Supporters of Musk and the company view him as a visionary akin to Apple co-founder Steve Jobs, while critics have likened him to a "Wizard of Oz" like figure who has yet to turn a profit.
While the decision isn't set in stone, Musk layout out a provisional plan to take the company private.
Musk's tweet came two weeks after Tesla revealed it had burned through $739.5 million in cash on its way to a record $717.5 million net loss in the second quarter, as it cranked out more electric cars.
Elon Musk is the world's 31st-richest person and Tesla's largest shareholder. He claims Tesla is the most shorted stock "in the history of the stock market" and that going private would remove them from the narrative. That baseless tweet was quickly deleted and Musk apologized to the diver.
Musk said in subsequent tweets that he would remain chief executive under a go-private transaction and that any deal would benefit shareholders.
The SEC did not immediately respond to a request for comment on Musk's tweet. The CEO said shareholders would have the final say if he decides to follow through on going private, and that he would stay in his job. It is also the only auto maker building cars (some of them) under a tent, as Tesla strains to crank out cars for Model 3 buyers in the waiting line to buy and collect tax credits.
But asked if he would take legal action against Musk over the allegation, Unsworth said: 'If it's what I think it is yes'. "Plus this is short squeeze rocket fuel after a nice quarter", said analyst Chaim Siegel from Elazar Advisors.
"Given his historic frustration with short sellers, analysts and certain parts of the press, it is perhaps also not surprising that he has given consideration to taking the company private".
Tesla has been the subject of a number of short sales by investors - who feel the money-losing company doesn't have a path to profitability and that its shares will tumble.