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Elon Musk Decides to Keep Tesla As A Public Company

"I knew the process of going private would be challenging, but it's clear that it would be even more time-consuming and distracting than initially anticipated." Musk said.

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Tesla appoints Robyn Denholm to replace Musk as Chairman. Pixabay
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Paying heed to his investors’ feedback, Tesla Chairman and CEO Elon Musk has decided not to veer the electric carmaker off the road and let it remain a publicly traded company to stay focus on becoming profitable.

On August 7, Musk surprised the investment world with a Twitter announcement that he was considering taking Tesla private and that the funds needed to do so were “secured”.

Musk’s tweet caused a financial firestorm with Tesla shares immediately skyrocketing. But in later days, they lost a good part of what they had gained and tanked further over the confusion which way Tesla might go.

In a blog post late on Friday, Musk took a U-turn, saying his investors were extremely important to him.

“Almost all have stuck with us from the time we went public in 2010 when we had no cars in production and only a vision of what we wanted to be.

“Given the feedback I’ve received, it’s apparent that most of Tesla’s existing shareholders believe we are better off as a public company,” Musk wrote.

This came after Musk had discussions with existing shareholders and financial advisors and learned that there was little appetite for such a move.

Elon Musk
Elon Musk, founder, CEO and lead designer at SpaceX. VOA

“Additionally, a number of institutional shareholders have explained that they have internal compliance issues that limit how much they can invest in a private company. There is also no proven path for most retail investors to own shares if we were private,” said Musk.

“Although the majority of shareholders I spoke to said they would remain with Tesla if we went private, the sentiment, in a nutshell, was ‘please don’t do this’,” he added.

Since the Musk announcement came over the weekend, its impact on Tesla stock will only be visible when the US market reopens on August 27.

Musk said he worked with investment firms like Silver Lake, Goldman Sachs and Morgan Stanley to consider the many factors that would come into play in taking Tesla private.

He also spent considerable time listening to current shareholders, large and small, to understand what they think would be in the best long-term interests of Tesla.

Also Read: Tesla Chairman Elon Musk’s Twitter Gets Hacked Again

“I knew the process of going private would be challenging, but it’s clear that it would be even more time-consuming and distracting than initially anticipated. This is a problem because we absolutely must stay focused on ramping Model 3 and becoming profitable,” Musk said.

In an interview to The New York Times this month, Musk spoke about “excruciating” times and long working hours at Tesla, noting that he “nearly missed his brother’s wedding this summer and spent his birthday holed up in Tesla’s offices as the company raced to meet elusive production targets on a crucial new model”.(IANS)

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Robyn Denholm Replaces Elon Musk As Chairman Of Tesla

Musk accepted the deal with the SEC "without admitting or denying the allegations of the complaint", according to a court document.

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Tesla
Tesla appoints Robyn Denholm to replace Musk as Chairman. Pixabay

 Electric car company Tesla on Thursday announced the appointment of Robyn Denholm, an executive at Australian firm Telstra, to become the Chair of the Tesla Board.

Denholm takes over the role from Elon Musk who agreed to step down as Chairman of Tesla for three years and pay a $20 million fine in a deal with the stock market regulatory authority, Securities and Exchange Commission (S.E.C.) to resolve securities fraud charges.

Musk will remain as Tesla’s chief executive.

“Robyn will be leaving her role as CFO and Head of Strategy at Telstra, Australia’s largest telecommunications company, once her six-month notice period with Telstra is complete. Robyn will be serving as Tesla Chair on a full-time basis,” Tesla said in a statement.

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A Telsa car recharges at a Tesla charging station in Charlotte, N.C. VOA

To ensure a smooth transition during the remainder of Robyn’s time at Telstra, Musk will be a resource to her and provide any support that she requests in her role as Chair.

“Robyn has extensive experience in both the tech and auto industries, and she has made significant contributions as a Tesla Board member over the past four years in helping us become a profitable company,” said Musk.

“I look forward to working even more closely with Robyn as we continue accelerating the advent of sustainable energy,” he added.

Denholm has served on the Tesla Board as an independent director since 2014.

Her global experience in both Australia and Silicon Valley encompasses leadership roles across a range of technology companies, including Telstra, Juniper Networks, and Sun Microsystems.

Tesla CEO Elon musk
Elon Musk agrees to step down as Chairman (VOA)

“I believe in this company, I believe in its mission and I look forward to helping Elon and the Tesla team achieve sustainable profitability and drive long-term shareholder value,” said Denholm.

The US SEC last month announced the deal with Tesla, after it sued Musk in federal court for misleading investors over his post on Twitter in August that he had “funding secured” for a buyout of the electric-car company at $420 a share, reports The New York Times.

Also Read: Elon Musk Shows a New Transportation System Being Developed Under LA

Musk accepted the deal with the SEC “without admitting or denying the allegations of the complaint”, according to a court document.

His tweet about taking his company private, along with attacks on critics on social media, raised concerns with investors about whether Musk has become too focused on criticism from so-called short-sellers who had been making bets against him and the company. (IANS)