from the say-what-you-mean-and-mean-what-you-say dept.
Tesla Is Said to Be Subpoenaed by S.E.C. Over Elon Musk Tweet (archive)
Federal securities regulators have served Tesla with a subpoena, according to a person familiar with the investigation, increasing pressure on the electric car company as it deals with the fallout from several recent actions by its chief executive, Elon Musk.
The subpoena, from the Securities and Exchange Commission, comes days after regulators began inquiring about an Aug. 7 Twitter post by Mr. Musk, in which he said he was considering converting Tesla to a private company. In the post, he said that the financing for such a transaction, which would probably run into the tens of billions of dollars, had been "secured."
Tesla shares, a popular target for so-called short sellers who bet on certain stocks losing value, soared about 11 percent on the day Mr. Musk posted the message.
It has become clear since then that neither Mr. Musk nor Tesla had actually lined up the necessary financing aside from having preliminary conversations with some investors.
Musk tweeted[*] that he wanted to take Tesla private at $420 a share. Azealia Banks claimed[**] to have been in Musk's home and witnessed Elon Musk tweeting while using LSD and making frantic calls to shore up funding for a take-private attempt. Maybe Azealia Banks will be called to testify by the SEC?
[*] The actual tweets:
Am considering taking Tesla private at $420. Funding secured.
9:48 AM - 7 Aug 2018Shareholders could either to sell at 420 or hold shares & go private
11:13 AM - 7 Aug 2018
[**] Take Azealia Banks' words with a grain of salt.
Also at Ars Technica, CNBC, The Wall Street Journal, The Guardian, and Bloomberg.
See also: Goldman Sachs says it's advising Tesla
The Real-Life Consequences of Messing Around on Twitter
Previously: Elon Musk Considers Taking Tesla Private
Funding for Tesla to Go Private Could Come From Saudis; Lawsuits and SEC Scrutiny Increase
Related Stories
Elon Musk Considers Taking Tesla Private
Elon Musk Makes $82 Billion Gambit to Silence Tesla Critics
Seemingly out of the blue, Elon Musk proclaimed that he might pull his money-losing Tesla Inc. off the market. Taking the electric-car company private at the price he touted would amount to an $82 billion valuation, a monumental sum that left many investors wondering: Is this a joke?
It wasn't.
[...] "The reason for doing this is all about creating the environment for Tesla to operate best," Musk, 47, wrote Tuesday in an email to employees. He said wild swings in the carmaker's stock price are a "major distraction" to Tesla workers, who are all shareholders. And he said that being public "puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long-term."
To take Tesla private, Musk would have to pull off the largest leveraged buyout in history, surpassing Texas electric utility TXU's in 2007. And Tesla doesn't fit the typical profile of a company that can raise tens of billions of dollars of debt to fund such a deal.
[...] "The market doesn't believe him," said David Kudla, the CEO of Mainstay Capital Management, which is betting against Tesla. "His credibility has come into question over a number of things. If this were real, you'd expect the stock to go closer to $420 a share than it has." Most major buyouts also require a trip to the junk bond markets, where Tesla has fallen out of favor.
Tesla Shares Resume Trading, Musk Posts Blog on Why Company Should Go Private
"Tesla resumed trading on the Nasdaq exchange after a nearly two-hour pause on Tuesday afternoon, shortly after the company confirmed in a blog post that CEO Elon Musk is considering taking the electric car maker private at $420 per share."
foxbusiness.com/markets/elon-musk-fires-up-tesla-blog-to-explain-idea-of-going-private
Musk Says 'Funding Secured' Claim Sparked by Saudi Meeting
Elon Musk said interest from Saudi Arabia's sovereign wealth fund gave him the confidence to drop the bombshell last week that he was considering taking Tesla Inc. private. The Saudi Kingdom's Public Investment Fund had approached Musk going back almost two years about taking Tesla off the market, he wrote in a blog post Monday, confirming that the fund recently bought an almost 5 percent stake. Musk described a July 31 meeting in which the Saudi fund's managing director expressed regret that Tesla hadn't moved forward with a go-private transaction.
[...] Several investors have since sued Musk and Tesla, claiming the company's share price had been manipulated. The Securities and Exchange Commission is said to be intensifying its scrutiny of the company and its chief executive officer after having started gathering general information about Tesla and Musk's earlier public pronouncements about manufacturing goals and sales targets.
One of Tesla's biggest critics, Vertical Group analyst Gordon Johnson, read Musk's blog post as a walk-back maneuver from his "funding secured" tweet last week. He cited Musk's statement Monday that the Saudi fund's support for taking Tesla private was "subject to financial and other due diligence and their internal review process for obtaining approvals." "He is specifically stating that funding is not secured, and I think that's a big deal," Johnson, whose $93 price target on Tesla shares is the lowest among Wall Street analysts, said on Bloomberg Television. "The question then becomes, what does the SEC do here, and do the shareholders stick with him?"
Also at CNBC.
Previously: Elon Musk Considers Taking Tesla Private
Elon Musk Reaches Settlement in SEC Tweet Battle:
Elon Musk has reached a deal with the Securities and Exchange Commission, the two parties said in a legal filing on Friday. The new agreement provides much more detailed guidance about when tweets and other public statements by Musk must be approved by Tesla lawyers.
Musk's original deal with the SEC was announced last September. It required Musk to obtain pre-approval for tweets that "contain or could contain" information that's material—legal jargon for information that's significant to shareholders. While the SEC expected Musk to begin regularly clearing tweets with lawyers, Musk interpreted this language as giving him significant discretion to decide for himself which tweets contained material information. As a result, he didn't seek legal review for any tweets in the first few months the agreement was in effect.
[...]Under the new rules, Musk must get a Tesla securities lawyer's sign off on tweets (and other communications) regarding Tesla's finances, its production and delivery numbers, new lines of business, sales projections, proposed mergers, fundraising efforts, regulatory decisions, and several other types of information.
The SEC says that if the judge signs off on these new terms, the SEC will drop its request for Musk to be held in contempt. In other words, the SEC seems to be satisfied with getting Musk to start seeking legal review for his tweets the way the agency thought Musk had been doing since last time. The SEC is not seeking to punish Musk further for his February tweet.
Given how well Elon Musk followed the intent of the prior ruling, I wonder how closely he will follow this ruling?
Previously:
Funding for Tesla to Go Private Could Come From Saudis; Lawsuits and SEC Scrutiny Increase
SEC Reportedly Subpoenas Tesla Over Take-Private Tweet
Tesla Facing Criminal Probe
Elon Musk Accused by SEC of Misleading Investors in August Tweet
SEC Settlement: Elon Musk Resigns as Chairman of Tesla, Stays as CEO, $40 Million in Fines Paid
Elon Musk Isn’t on His Twitter Leash Yet, So He’s Taunting the SEC
(Score: -1, Troll) by Anonymous Coward on Thursday August 16 2018, @06:32AM (2 children)
boring, space-faring, whacky cars.. a boy child engineer's ego inflated by his subconscious.. and perhaps too much sativa. its a live opportunity to watch the destructive effects of hubris on a fascinating life, and our collective willingness to tolerate lying actors.
there will be fans, there will be haters. me? i'm just watching the personal tragedy unfold. learn yourselves something new and read "THE RELATIONS BETWEEN THE EGO AND THE UNCONSCIOUS" here: https://archive.org/details/collectedworksof92cgju [archive.org]
(Score: 1, Interesting) by Anonymous Coward on Thursday August 16 2018, @06:36AM
oops, that one https://archive.org/details/C.G.JungCollectedWorksVol7Part1TheEffectsOfTheUnconsciousUponConsciousness [archive.org]
(Score: 0) by Anonymous Coward on Thursday August 16 2018, @01:54PM
Has he started collecting his pee and stopped cutting his fingernails yet?
(Score: 1, Flamebait) by TheReaperD on Thursday August 16 2018, @06:35AM (7 children)
So, instead of drunk texting, it's LSD Tweeting. This is going to be an expensive fuckup and likelly the most expensive dose of LSD Elon Musk will ever take.
Ad eundum quo nemo ante iit
(Score: 0) by Anonymous Coward on Thursday August 16 2018, @06:39AM
i think you're gonna enjoy and be able to profit from that pdf i linked ;)
(Score: 4, Interesting) by takyon on Thursday August 16 2018, @07:23AM (1 child)
It's very early days into this fiasco and Azealia Banks is one of the worst witnesses you could pick, with a history of beefing with other celebrities to grab attention and making some racist comments (and not just what's cited in the Wikipedia article [lipstickalley.com]).
The improbability of singer-songwriter Azealia Banks getting involved with this stems from Musk's new girlfriend Grimes [wikipedia.org] (Claire Boucher). Banks was supposedly at Musk's house for a musical collaboration with Grimes, and was supposedly waiting around there for about two days, as if that makes any goddamn sense. In her tweet storm, she ended up lambasted Musk for his father's emerald mine wealth [businessinsider.co.za] and claimed that Musk and Grimes wanted a threesome with her.
But while the story is a little crazy, it definitely sounds like it could be true, right? There was that dust-up about Musk (among others) attending what was alleged to be one of Silicon Valley's sex and drug [businessinsider.com] parties [marketwatch.com]. Ashlee Vance's [wikipedia.org] biography of Musk portrays him as "straight-laced" [entrepreneur.com] and not a frequent user of alcohol. But everyone knows that LSD is far safer than alcohol [bbc.com] and Silicon Valley is big on microdosing [businessinsider.com]. Programmers, engineers, and visionaries like Musk are often attracted to the practice.
So in summary, the current year is 2018, year 2 of our lord Trumpu, and everybody is going cray-cray. In stark contrast with the tight ship that is SpaceX (thanks Gwynne Shotwell [bloomberg.com]!), Tesla can't go a quarter without having to suffer from some Musk drama or debt and production issues. Which may be part of the motivation behind going private. I don't have a strong opinion about whether or not Tesla going private would be a good thing. Feel free to make your case.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 3, Informative) by MostCynical on Thursday August 16 2018, @08:30AM
And now Elon says he hasn't even met her..
https://pagesix.com/2018/08/14/elon-musk-denies-ever-having-met-azealia-banks/ [pagesix.com]
"I guess once you start doubting, there's no end to it." -Batou, Ghost in the Shell: Stand Alone Complex
(Score: 3, Insightful) by theluggage on Thursday August 16 2018, @11:40AM (3 children)
Ah, Twitter - all those stupid things human beings say when they're drunk, stoned, upset, lonely or just plain bored - once forgotten by the morning after, now recorded, preserved for posterity, made available to all and mistaken by journalists as a source of news.
This planet should host a Disaster Area concert to drown out all the tweeting...
What's really frightening is the degree of seriousness that some people apply to tweets (buying/selling shares, voting for orange people, etc.)
(Score: 2) by takyon on Thursday August 16 2018, @12:37PM (2 children)
Twitter is just a medium. Any embarrassment that can be spewed on Twitter could as easily be posted on Facebook or other social media platforms. Twitter potentially has a greater reach, since you can read tweets without logging in. The short form might also encourage dumber behavior, but the character limit has been doubled and you can just write multiple tweets or post a text image anyway.
Your real problem is with human nature and the ability to communicate over the Internet. Anybody can gain an audience of millions, sometimes on accident. And anyone can broadcast whatever is on their mind, with essentially no filter. Tweets being reported as news isn't necessarily any worse than short soundbites being overanalyzed, or official statements (such as short press releases) being reported on.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 2) by theluggage on Thursday August 16 2018, @10:04PM (1 child)
True, and of course stupid things are propagated on other media (understatement of the year). However, Twitter in particular does seem to have struck a chord with politicians, celebrities and the media - probably because the short format lets you fire off a soundbite before you've had time to think about it, and it feels ephemeral. Easy to write, easy to scan for gossip.
I mean, even 'RealDonaldTrump' sounds more thoughtful and intelligent when they post here on SoylentNews than they do on Twitter - it's almost like they're an entirely different person entirely... :-)
(Score: 2) by takyon on Thursday August 16 2018, @10:15PM
So weird! 🗽
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 0) by Anonymous Coward on Thursday August 16 2018, @02:41PM
Has it? The only thing I've seen is a bunch of conjecture by astroturfers and the publishers who are dumb enough to print their vomit. Exactly HOW has it "become clear"? Last weeks slander is now this weeks fact I expect. Typical NYT tripe.
And BTW, how many of those shorts were New York Times employees? And how many of them have also been flogging astroturfing about the inevitable demise of Tesla? And isn't THAT stock manipulation?
Funny how quickly the SEC responded. It took them years to go after Madoff after he was outed. And since they still haven't really prosecuted the perpetrators of the 2008 wall street collapse, you've go to wonder about the nature of their decisions. Or or has that not yet "become clear" to the New York Times? I expect so. Wouldn't even be surprised if the "clarity" was coordinated.