Tesla boss Elon Musk stated in a tweet that he was considering taking the firm private to focus on its long-term goals. The electric car company is listed on the American Nasdaq stock exchange, but stock prices have been erratic recently, more so with the firm under pressure to achieve production targets for the new Model 3.
Musk owns 20 percent of the shares in Tesla, and has stated that he was considering taking the company private at $420 a share, roughly a fifth higher than the current market price.
He stated that no decision has been made but the possible move was about “creating the environment for Tesla to operate best”.
He added, “As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla, all of whom are shareholders. Being public also subjects us to the quarterly earnings cycle that puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long term.”
The 47-year-old added the move would protect Tesla from short sellers who, in Musk’s words, “have the incentive to attack the company”.
Musk said all current shareholders will have the choice to stay on as investors in the private company, and that employees would remain shareholders. He added that if Tesla reached a “phase of slower, more predictable growth”, the firm could go public again.
The proposal will have to be voted on by Tesla shareholders before it goes ahead. Saudi Arabia’s sovereign wealth fund has also reportedly bought a $2 billion stake in the firm.