The Securities and Exchange Commission (SEC) subpoenaed Tesla regarding CEO Elon Musk’s tweets announcing plans to take the company private, Fox News reported Wednesday.
Tesla’s shares tumbled 4 percent to $333.33 following the report. Musk said in an Aug. 10 tweet that he was considering taking Tesla private at $420 per share. He also suggested that he had “funding secured” for the venture, according to a tweet from Fox News’s Charles Gasparino.
“Subpoenas signal investigation has reached the “formal” stages,” Gasparino noted. Tesla declined to comment, while the SEC was not immediately available for comment. Musk told his Twitter followers that he was planning to take the company private at $420 per share, far more than the company’s current worth.
His tweet followed a report suggesting Saudi Arabia became a major Tesla shareholder earlier this year. (RELATED: What Happens To Tesla Devotees If Musk Takes The Company Private?)
Musk’s tweets came shortly after Saudi Arabia’s Public Investment Fund (PIF) bought 5 percent of the electric vehicle maker’s shares this year. The PIF’s position is worth between $1.7 billion and $2.9 billion at Tesla’s current share price. PIF instead acquired the position through secondary markets with the help of JPMorgan. The exact date of the purchase likely happened while the Crown Prince Mohammed bin Salman was touring the U.S. in March.
Tesla breezed through $1.8 billion in the first half of 2018, yet the paltry showing doesn’t appear to have dragged on Musk’s spirt. The beleaguered CEO maintains the electric carmaker will be cashflow positive in the final two quarters of the year. The company’s shares rose 4.7 percent following the report.
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