Tesla’s South African-born founder Elon Musk moved into damage control mode yesterday with a 1,100 word blog on the electric car company’s website to defend last Tuesday’s nine word Twitter bombshell. But it brings to mind the old saying that when you’re in a hole, best to just throw away the space.
Musk’s tweet, which referred to a $420 a share buyout price with “funding secured”, pushed Tesla’s share price 11% higher. That added $6bn to the company’s market value by the session’s close. But when it surfaced the idea was far from baked, Tesla’s share price fell back to pre-tweet levels.
Unfortunately for Musk, when a share price swings that way fortunes are made and lost. And in Tesla’s case, two of the losers have already launched law suits, accusing him of fraud. They say the tweet to his 22m Twitter followers was designed purely to drop a nuclear bomb on short-sellers.
In yesterday’s blog Musk says he has had several meetings with the MD of the Saudi Sovereign Wealth fund about taking Tesla private. But he added the Saudi first requires a comprehensive due diligence and refers to “if and when a final proposal is presented.” A long way from the apparent certainty of that infamous nine word tweet.