Tesla's share price was down more than two per cent as markets opened in the US this afternoon, after analysts on Wall Street balked at its chief executive Elon Musk's claims he could take the firm private.
Trading was temporarily suspended yesterday following a string of tweets from Musk in which he said he was considering taking Tesla private at a price of $20 (£325) per share. The company closed the day up 10.99 per cent.
Though Musk reassured investors that he already has the funding necessary to do so, most analysts remained sceptical.
Some members of the company's board – notably missing Musk's brother Kimbal Musk and Steve Jurvetson – also put out a statement this afternoon acknowledging Musk's intentions, refuting claims that they hadn't been informed of his decision before the tweets went out.
"Last week, Elon opened a discussion with the board about taking the company private," it read. "This included discussion as to how being private could better serve Teslas long-term interests, and also addressed the funding for this to occur."
"The board has met several times over the last week and is taking the appropriate next steps to evaluate this."
Read more: Elon Musk: a private Tesla would be an 'enormous opportunity'
Adrian Hull from Kames Capital said that Tesla going private was, "suffice to say, not one for us… Whod want to spend that when you could buy a couple of luxury German car manufacturers for the same price?"
One investor, the CEO of Gerber Kawasaki Wealth & Investment Management, Ross Gerber, said last night he had "no intention" of selling his shares at $420. "The stock is worth $570 a share based on 2019 revenue. No way Elon, I'm keeping my stock," he said on Twitter.
AJ Bell's investment director Russ Mould said the fact that Tesla's share price has yet to reach the $420 mark "speaks loudly of wider scepticism", given that the company's losses continue to rise in tandem with its output.
He continued: "It is unclear how Mr Musk will proceed from here, given the lack of clarity over the timing or funding mechanism for any move to take Tesla private."
Read more: Musk's Tesla tweet 'makes a mockery' of trading rules
Musk defended the rationale behind his decision to publicly declare his intentions in an email to Tesla employees last night, which said it's "all about creating the environment for Tesla to operate best".
He argued that being a public company is distracting for employees, when analysts consistently short Tesla's stock and its share price is typically volatile to say the least.
"Basically, Im trying to accomplish an outcome where Tesla can operate at its best, free from as much distraction and short-term thinking as possible," he added.
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