TSLA what a joke

Daal said:
You are right, the thing is, these firms can always accept to be taken out at $420. All Musk needs to do is to convince them to vote for what he wants. The man was able to get rockets in space and land them back down, if he says 'this is the only way forward, otherwise this company might not be viable (or some other such exaggeration)' it will be hard for them to vote against. The Saudis easly have $20-$40B to cash out anyone that wants. This seems similar to Warren Buffett bringing a matter for a vote at BRK, its hard for him to lose a vote because the shareholder base is full of believers. He did get that $50B pay package approved this year afterall
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But then he has to find an equity investor or a debt investor willing to take them out. My point is that it's not a 20bn transaction. It IS a 60bn transaction. Impossible to do with a company that's hemmoraging money in my opinion.
 
newwurldmn said:
But then he has to find an equity investor or a debt investor willing to take them out. My point is that it's not a 20bn transaction. It IS a 60bn transaction. Impossible to do with a company that's hemmoraging money in my opinion.
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T Row Price has a private equity arm, there are probably other holders that can hold private stakes too. Musk tweeted "Investor support is confirmed", he did that for a reason
 
newwurldmn said:
But then he has to find an equity investor or a debt investor willing to take them out. My point is that it's not a 20bn transaction. It IS a 60bn transaction. Impossible to do with a company that's hemmoraging money in my opinion.
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here is an ok article talking about the funding needs
https://seekingalpha.com/article/4197043-tesla-much-cash-realistically-secure
"At a minimum, 16% of the $70B ($11B) needs to be secured to buy out the general public (non-institutional investors). At a maximum, we will assume that insiders will remain as private company shareholders, and the remaining 80% of the $70B ($56B) needs to be secured for all the other shareholders."

He then arrives at a more realistic figure of $30B assuming some institutions roll over into private stakes (like T Row Price). $30B is just 12% of the AUM of the Saudi fund that announced their stake and only 4% of the entire wealth managed by Saudi Arabia (and Musk might have more ultra wealthy contacts). So the short case depends on Musk believers not voting for what their master wants and what a few lunatics in Saudi Arabia decide, I wouldn't want to be in that bet
 
Daal said:
here is an ok article talking about the funding needs
https://seekingalpha.com/article/4197043-tesla-much-cash-realistically-secure
"At a minimum, 16% of the $70B ($11B) needs to be secured to buy out the general public (non-institutional investors). At a maximum, we will assume that insiders will remain as private company shareholders, and the remaining 80% of the $70B ($56B) needs to be secured for all the other shareholders."

He then arrives at a more realistic figure of $30B assuming some institutions roll over into private stakes (like T Row Price). $30B is just 12% of the AUM of the Saudi fund that announced their stake and only 4% of the entire wealth managed by Saudi Arabia (and Musk might have more ultra wealthy contacts). So the short case depends on Musk believers not voting for what their master wants and what a few lunatics in Saudi Arabia decide, I wouldn't want to be in that bet
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A funny aside that we're talking about the Saudi sovereign wealth fund investing in something whose major impact will be to reduce the main export of Saudi Arabia's main product (most oil is used in transportation, only .5% of U.S. electricity comes from oil fired plants). If they do make a 12% of the fund size bet, it says something significant far beyond Tesla.
 
newwurldmn said:
No sovereign wealth fund will bet 12percent of their AUM on one speculative technology company.
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Perhaps, but what about 8%? or 6%? They also got Tencent as a shareholder, they got over $100B in cash. Who knows who else Musk got in his rolodex. Point is, this doesnt look as unlikely as the news media is making it out to be. He did say he had investor support and financing was secured, looks like he already had the meetings and made the phone calls
 
Daal said:
I changed my mind on TSLA. Musk is not realling trying to pull an LBO, since that is impossible. He is trying to convince a lot of equity people to accept dropping their liquidity needs and join a dream. He is a pretty good dream seller, so I wouldnt want to bet against that. I mean, if every single large shareholder today accepted to own private shares, well, the company would be private, because all they would need would be to raise $10-$20B to take out the smaller shareholders and that's it. They would pull this off without having to raise a single dollar in debt capital. I wouldn't bet againt Musk convincing people, obviously he already suceeded with that soverign wealth fund (and I suspect that fund wants more shares that they bought, they disclosed a 5% stake, the first threshold for disclosure, there is no reason to think they stopped buying)

My mistake was confusing the word 'funding' with debt funding, Musk got equity funding, that's how he will get this done. To me, now its very telling that Musk tweeted right after the Saudi stake was disclosed and how he is trying to come up with ways for small shareholders to own private shares, thats all the funding that he needs
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LOL. You might want to consider reverting back to your original take on TSLA. Whoever made that outlandish conjecture probably has zero understanding or exposure in legal matters, civil and criminal.
 
Daal said:
He did say he had investor support and financing was secured,
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He also said there will be battery changing stations and they will make 5K/week by last year's end. What he says usually doesn't mean anything.

Yeah, so that's the thing....
 
Pekelo said:
He also said there will be battery changing stations and they will make 5K/week by last year's end. What he says usually doesn't mean anything.

Yeah, so that's the thing....
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True but common sense says that he will be more careful when talking about matters that can land him in jail. Sure, he could be being reckless but in my view 9 times out of 10, people as rich as him wouldn`t make that mistake. Especially given that he only tweeted after the Saudis reported their stake, thats the tell the whole thing is legit. IMO
 
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