Tesla Hit With Third Class-Action Suit Over Musk's Stock Tweets

Elon Musk

Reuters, citing a source, reported after the tweet that Silver Lake was not discussing participating as an investor in the deal and "was offering its assistance to Musk without compensation and had not been hired as a financial adviser in an official capacity".

Musk broke silence in a blog post Monday after several days of speculations on how he is going to privatize Tesla following his announcement on Twitter on August 7 that he was considering taking Tesla private at a price of 420 USA dollars per share.

Tesla announced on Tuesday that the board of directors has created a three-person special committee to consider taking the all-electric vehicle company private. Their investigation is part of a larger probe into the information Musk provides on Twitter, including sales targets and other goals.

One assumes Yeagar jumped at the opportunity to buy Tesla stock and then sell it off at the proposed $US420 ($577) per share price tag, only to see its value drop after investors began to question the veracity of Musk's claims.

Elon Musk has confirmed plans to take Tesla private with the backing of a Saudi Arabian sovereign wealth fund.

"I'm excited to work with Silver Lake and Goldman Sachs", Musk tweeted on Monday.

"This is why I referred to "funding secured" in the August 7th announcement".

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Apart from the Saudi sovereign fund, Musk said he is having talks with other potential investors about his privatization plan.

Tuesday's announcement means three members of Tesla's board will now weigh whether it is advisable - or even feasible - to pursue what could be the biggest-ever go-private deal, and they are doing so before receiving a formal proposal from the CEO.

Musk added that most capital for the deal would come from equity and it would not be "wise" to burden the company with added debt.

Buss was chief financial officer of solar panel installer SolarCity for two years before retiring when Tesla paid $2.6 billion for the sales and installation firm in 2016.

In the days that followed, the SEC got involved, reportedly investigating Musk's online musings about taking the company private.

Latham and Watkins LLP has been retained by the committee as its legal counsel.

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