Elon Musk’s Mysterious Ways Showcased in Tesla’s Tweet Trial

Elon Musk’s enigmatic personality and unconventional tactics are emerging as key exhibits in a trial centered around one of his most polarizing pursuits—tweeting.

The trial, which focused on a pair of tweets announcing that Musk had received money to take Tesla private in 2018, lured the 51-year-old billionaire into a federal courtroom in San Francisco for three days to testify. care about.

Musk, ai now owns the Twitter service which he deploys as his loudspeaker, usually a contrarian study of about eight hours standing in the stands. The electric carmaker’s CEO is facing a class-action lawsuit filed on behalf of Tesla shareholders after Musk posted a tweet about the company’s acquisition but it didn’t. happen.

Through both his testimony and the evidence presented around it, Musk is seen as impulsive, rude, belligerent, and contemptuous of anyone who questions his motives as a businessman. game-changer who inspired comparisons with the late Apple co-founder Steve Jobs.

At other times, Musk seems like the visionary whose supporters hail him — an intrepid rebel who has, by his own estimates, raised more than $100 billion. from investors. They’ve been well rewarded with his leadership of pioneering companies including PayPal in digital payments, Tesla in electric vehicles and SpaceX in rocket ships.

“It’s relatively easy for me to get investment support because my track record is extremely good,” Musk wittily commented.

But his be confident in your abilities to get the money he wanted to pursue his plan was one reason he went to court. The three-week trial will continue on Tuesday and head for jury deliberations on Friday.

Here’s what to know so far:

PLANT VARIETIES

Evidence and testimony shows that Musk began considering taking Tesla private in 2017 so he wouldn’t have to deal with the headaches and distractions of running a publicly traded company.

After the meeting on 31 July 2018 with the high-ranking representative of Saudi Arabia sovereign wealth fundMusk sent a letter to Tesla’s board outlining why he wants to take the automaker private at $420 a share — about 20% more than the price. its shares. stock price at that time.

Musk was so serious that he discussed the pros and cons with Michael Dell, who went through the transition from public to private in 2013 when he led the acquisition of the personal computer company that brought the company. His name is worth $25 billion, according to trial evidence. .

Troubled Tweets

The crux of the case revolved around an August 7, 2018 tweet in which Musk stated “funding guarantee” to privatize Tesla. Musk abruptly tweeted a few minutes before boarding a private jet after being informed that the Financial Times was coming soon publish a story that Saudi Arabia’s Public Investment Fund spent about $2 billion buying a 5% stake in Tesla to diversify their interests beyond oil, according to his testimony.

Amid widespread confusion over whether Musk’s Twitter account was hacked or he was joking, hours later Musk followed up with another tweet suggests an impending deal.

Musk defended the original tweet as a move in good faith to make sure all Tesla investors know that the automaker could be on track to end eight years later as a a public company.

“I have no ill motives,” Musk testified. “My intention is to do the right thing for all shareholders.”

Guhan Subramanian, a Harvard law and business professor hired as an expert for shareholder attorneys, derided Musk’s method of announcing potential acquisitions as an “extreme outlier” with potentially many conflict.

“The risk is that Mr. Musk has timed his (management acquisition) proposal announcement to serve his own interests rather than the interests of the company,” Subramanian testified.

WHERE’S THE MONEY?

There is another problem that threatens to weaken Musk’s defenses. He did not finance his proposed deal or even determine the amount required to make it happen, based on testimony from Musk, other witnesses and other evidence.

That’s one reason U.S. District Judge Edward Chen decided last year that Musk’s 2018 tweets were untrue and directed the jury to view them that way.

It also led regulators to accuse Musk of misleading investors with tweets, leading to a $40 million settlement with the US Securities and Exchange Commission and demanding Musk’s resignation. Tesla chairman.

Chen ruled that the 2018 settlement, in which Musk did not admit wrongdoing and has since lamented the implementation, could not be referred to the jury.

Musk testified that he believed he had secured an oral commitment to provide whatever funds were needed for the acquisition of Tesla during a face-to-face meeting on July 31, 2018 with Yasir al-Rumayyan, Saudi Arabia’s wealth fund governor.

That was reinforced in testimony from former Tesla chief financial officer Deepak Ahuja, who was at the discussions and gave al-Rumayyan a half-hour tour of a Tesla factory.

But a text message al-Rumayyan sent Musk following the “funding guaranteed” tweet suggested that discussions about the Saudi fund funding a private acquisition were preliminary.

“I would like to hear what your plan, Elon, and the financial calculations to make it happen,” al-Rumayyan wrote to Musk, according to a copy submitted as evidence during the trial.

Musk framed al-Rumayyan’s text as an attempt to back away from his previous commitment. He also confirmed the Saudi fund had made a “clear commitment” to finance the acquisition.

CONTROL MONEY

Following his 2018 tweets, Musk managed to raise the money needed to acquire Tesla with the help of Egon Durban, co-CEO of the private equity firm Silver Lake, which helped financed the acquisition of Dell in 2013. top executives from Goldman Sachs, an investment banking firm that has worked closely with Tesla.

In their testimony, both Durban and Dees discussed the attempt to raise money to acquire Tesla to a variety of potential investors including two Chinese companies, Alibaba and Tencent, as well as Google in initial documents containing the statement. codenamed “Project Turbo”, then “Project Titan.”

The acquisition would require between $20 billion and $70 billion, according to the documents — the funding was never close to being raised, both Durban and Dees testified, largely because Musk dropped the investment proposal. personified Tesla on August 24, 2018. After consulting with shareholders.

Tesla shares are now worth eight times what they were then, after adjusting for two stock splits.

Musk still thinks he might have gotten the money he wanted, and that even if there was a shortfall, he could make up any shortfall by selling some of his stock in SpaceX due to a lack of money. privately held. That’s the strategy Musk used when he bought Twitter for $44 billion, except that he sold about $23 billion of his stock in Tesla.

Durban and Dees both testified that they were certain the acquisition money could have been raised – former Tesla chief Antonio Gracias echoed that.

“He’s the Michael Jordan of fundraising,” Gracias testified.

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