Tesla Inc TSLA CEO Elon Musk said that he was sure of support from Saudi backers to take the automaker private in 2018, but they later backtracked on the commitment.
What Happened: Musk testified at a trial in a San Francisco federal court that he met with representatives of Saudi Arabia’s sovereign wealth fund, the Public Investment Fund, at Tesla’s Fremont, California, factory on July 31, 2018, reported Reuters.
“PIF unequivocally wanted to take Tesla private,” said Musk in his testimony, according to Reuters.
Later, the governor of the fund, Yasir Al-Rumayyan, went back on the commitment to take Tesla private.
“I was very upset because he had been unequivocal in his support for taking Tesla private when we met and now he appeared to be backpedaling,” testified Musk.
See Also: How To Buy Electric Vehicle (EV) Shares
Why It Matters: Musk accepted during the testimony that he did not discuss a takeover price with PIF representatives, according to Reuters.
Tesla investors are accusing Musk of committing fraud when he tweeted in 2018 that he was taking the company private at $420 per share.
A jury of nine is set to decide if Musk artificially ramped up Tesla’s share price by discussing the buyout and if so by what amount, according to Reuters.
Musk said the $420 amount was chosen because “it was a 20% premium over the stock price.” He reportedly said the price was not a joke.
Price Action: On Monday, Tesla shares closed 7.7% higher at $143.75 in the regular session and rose 0.7% in the after-hours trading, according to data from Benzinga Pro.
Photo courtesy: Thomas Hawk on Flickr
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