Last Updated Aug 7, 2018 2:45 PM EDT
Tesla CEO Elon Musk said Tuesday over Twitter that he is considering taking the electric car manufacturer private, sending the stock up by more than 7 percent.
“Am considering taking Tesla private at $420. Funding secured,” Musk tweeted shortly before 1 p.m. on Tuesday.
Trading in Tesla shares, which is listed on Nasdaq, was halted at 2:08 p.m. pending further news.
Musk elaborated, saying existing shareholders “could either to sell at 420 or hold shares & go private.” He also said he was “super appreciative of Tesla shareholders” and would “ensure their prosperity in any scenario.”
It’s unclear if Musk, who is known for using Twitter to vent as much as outline company strategy, is seriously weighing taking the company, which only went public in 2010, private. Some on social media guessed the stock price Musk cited was a thinly veiled veiled marijuana joke referencing April 20, the unofficial “weed day” recognized by pot users.
But investors seemed to take Musk’s declaration seriously. Tesla’s stock, which was trading at about $342 per share, shot up to $365 per share immediately after the tweet. It was up 7.5 percent, at $367.25, when trading was halted at 2:08 p.m. The stock was already up Tuesday after the Financial Times reported that Saudi Arabia had taken a $2 billion stake in the electric car company.
Representatives for Tesla did not immediately confirm the tweet was genuine.
Musk is Tesla’s largest shareholder, with an approximately 20 percent stake valued at about $12 billion, according to S&P Capital IQ.
It isn’t the first time Musk has previously expressed a wish to take Tesla private, telling Rolling Stone last year that “it actually makes us less efficient to be a public company.”
More recently, he has drawn attention for his combative relationship with Wall Street. In a May earnings call, Tesla shares slipped after Musk derided “boring, bonehead” questions from analysts regarding the company’s finances. He apologized for the comments last week in Tesla’s latest conference call, saying “there’s no excuse for bad manners.”
Tesla has been under pressure from Wall Street to reduce its cash burn and turn a consistent profit. Key to that plan is ramping up production of the Model 3, a $35,000 mass-market model that has run into production and quality issues.
The company said last week it expects “to become both sustainably profitable and cash-flow positive” in the second half of this year. It had revenue of $4 billion in its latest quarter and a smaller-than-expected loss of $717 million.
— CBS News’ Jillian Harding contributed reporting.
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