You've all seen Elon Musk's "tweet of the year" by now, including his follow-up tweets.
Elon says he's considering taking Tesla (TSLA) private at $420 (per share, one assumes), that funding is secured, and follows up by "Good morning."
Let's start with the people whom Elon Musk has blocked from his Twitter account. Many market participants are blocked from his Twitter account. Are they not entitled to fair and uniform disclosure of material company information like this? I'm no lawyer, but it seems like this is an issue that would be debated heavily.
Tesla's 10-Q filing with the U.S. Securities and Exchange Commission came out Monday morning and it mentioned nothing about this. Did these going-private conversations start in barely the last day? Here is a link to the filing.
The other thing is about that "funding secured." Isn't that something that happens after a decision has been made to pursue a transaction like this? I mean, "considering" doing a deal doesn't happen after funding has been "secured."
Yet another thing that doesn't make sense here is this: If you are considering taking a company private, why would you pump up the stock price in advance of making an offer? That is as counterintuitive as it gets.
The company must file a 13-D immediately stating the intent and the basis for such an intent, including the financing that has been lined up. If this is not done, I think it would be a serious issue -- and that's even if tweeting out this information is OK to begin with in terms of fair and uniform disclosure.
Remember, saying that funding has been "secured" is very strong language. That must be backed up. Extraordinary claims call for extraordinary evidence. Just look at the fully diluted market cap plus debt of this company.
Tesla's board would also have to form an independent special committee to evaluate such an offer. Have they done so? When did the board find out about this -- individually and collectively?
(This column has been updated.)