Tesla’s board panel to study private proposal
An Australian telecom executive, the leader of a cosmetics company, and the former finance chief of Elon Musk’s solarpower company are now in charge of deciding Tesla Inc.’s fate.
The board of the electric-car maker formed a special committee to evaluate its chief executive officer’s proposal to take the company private, a day after he revealed more on who will advise him and help fund the potential deal. Directors Brad Buss, Robyn Denholm and Linda Johnson Rice compose the committee, which hasn’t received a formal proposal from Musk, according to a statement Tuesday. They haven’t reached any conclusion on whether taking the company private is advisable or feasible.
Musk, 47, set off a firestorm a week ago with his highly unconventional announcement of the effort to take the company private, and since then he has been drip-feeding details in tweets and blog posts that have pre-empted disclosures by Tesla’s board. The chairman and largest shareholder wrote late Monday that he’s getting advice from Goldman Sachs Group Inc. and private-equity firm Silver Lake and has lined up legal advisers.
But Goldman Sachs hadn’t been formally tapped as a financial adviser at the time, according to people familiar with the matter.
Musk said earlier that Saudi Arabia first approached him with interest in helping take Tesla private early last year.
Musk has said in blog posts that Tesla being public has forced the company to focus on short-term decisions that aren’t consistent with its long-term goals, and that he thinks going private would help the carmaker to operate at its best.
“The bears are dug in, the bulls are dug in, and so the public markets aren’t really functioning properly, or as they should,” James Albertine, an analyst with a buy rating on the shares, said Tuesday on Bloomberg Television. Private stakeholders would be able to “share in that longterm view with Elon ...”
Tesla shares fell 2.46 per cent to close at US$347.64 Tuesday in New York. The stock remains well below the US$420 level at which Musk has said existing shareholders could be bought out, underscoring skepticism that the deal is doable.