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Elon hints he'll buy back shares and "taking Tesla private"

Discussion in 'TSLA Investor Discussions' started by jkirkwood001, Aug 7, 2018.

  1. hockeythug

    hockeythug Active Member

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    Besides being an employee I think the only way is through the secondary market which many require you to be accredited investor status. I assume the Tesla one will be more accessible.
     
  2. david_42

    david_42 Member

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    Although I've seen several comments about what it would cost to go private, none of them seem to consider Musk's ownership share. That cuts the required funds $15-20B. Personally, given the option, I'd take shares in the private company. My shares are in retirement funds and I don't have to start withdrawals for another six years.
     
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  3. suwaneedad

    suwaneedad Member

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    "Hell hath no fury like an Elon scorned."

    Choose sides as you wish; I'm continuing to side with the guy that has the 1.000 batting average.
     
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  4. TheTalkingMule

    TheTalkingMule Distributed Energy Enthusiast

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    Went to the beach on a big day I guess. This is just an anti-short backstop, right? Force the price permanently above the price where bonds convert, right?

    This essentially puts TSLA in the clear for good. When's the next cheaper car announced? I want to see the Outback style Tesla starting at $32k.
     
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  5. P90D

    P90D Member

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    I bought my neighbor's lawnmower. He went and bought a nice new quiet one. I get to sleep in on Sundays.
     
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  6. P90D

    P90D Member

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    Right, so hopefully you sold it for much more than $20. : )
    upload_2018-8-7_18-47-25.png
     
  7. emupilot

    emupilot Active Member

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    The ask price was about double the bid price when I realized there might be a problem... on the other hand, I sold a Jan 2020 400 call to help pay for the Jan 2019 400s, so I'll catch the up-side of time value getting hammered too.
     
  8. P90D

    P90D Member

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    yeah, they'll try to disappoint you on that calendar
    I've asked the folks at tastytrade to explain how this will trade tomorrow ... it will be fun, but I'll be clearing out and staying away from things till I understand if there's any market left once the underlying is pegged in a buyback.
    In a buyout, it's pretty easy to understand that long theta is toast, but derivatives have a way of ... surprising. : )
     
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  9. neroden

    neroden Model S Owner and Frustrated Tesla Fan

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    Betting on something like Apple, Google, Microsoft, or Berkshire Hathaway. There's some institutions which could do it and are US-based. Or their primary shareholders. I think Brin and Page could borrow enough against their Google stock to make the offer personally...
     
  10. neroden

    neroden Model S Owner and Frustrated Tesla Fan

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    This is my hope, that it's basically a backstop which will put a floor on the stock price. But I think Musk really wants to go private. I hope the stock price rockets up enough to prevent it.

     
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  11. FrANce

    FrANce Member

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    Or, because it is 'Life, the Universe and Everything' times 10
     
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  12. Vinny809

    Vinny809 Member

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    #52 Vinny809, Aug 8, 2018
    Last edited: Aug 8, 2018
    What happens to shorts who decide not to cover in the event TSLA goes private? Will brokers force them to cover?
     
  13. Mario Kadastik

    Mario Kadastik Active Member

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    Yes, during delisting they have to return all the shares of stock they have loaned. This means that if they don't do, then their broker will have to independent on what it costs. They are the ones who gave the shares that belonged to someone else.
     
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  14. DoctorVenkman

    DoctorVenkman Member

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    Elon confirmed on twitter that there won't be a majority shareholder in the private company. It's not going to be a single company buying up Tesla.
     
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  15. electracity

    electracity Active Member

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    Exactly. Tesla is not being sold, they are delisting the common stock. The additional outside money needed is for common stock holders who want out. The convertible bond holders also presumably need to be paid out using the $420 conversion rate. A great deal for them.

    Elon has signaled two things: 1) He has the votes to go private, and 2) He has a buyer for any common stockholder who wants to be bought out at $420. The Saudis may have provided that financing.
     
  16. Reality

    Reality Member

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    yep, if any of this is not true then he committed fraud
     
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  17. DoctorVenkman

    DoctorVenkman Member

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    And if my mother was the Queen of England I'd be a prince. What's your point? Do you have any evidence that what he said is not true?
     
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  18. neroden

    neroden Model S Owner and Frustrated Tesla Fan

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    Yes. If they don't cover the broker is on the hook to return the shares to the long securities-holder, and the broker never wants to be on the hook, so the broker will force them to cover.
     
  19. Unicorn3

    Unicorn3 Member

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    If Saudis want to buy our stocks, they have to pay "at least" $420 as the lowest price.
     
  20. daniel

    daniel Active Member

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    I didn't buy my TSLA shares as an "investment." I bought them so I could feel that I am part of a company committed to building clean, quiet, efficient, transportation based on an energy source that can be produced sustainably. And because I loved my car so much. I still want to be part of the company, but at my age I'm not looking for long-term growth, but rather income. If Tesla offered to convert my shares into bonds with a good return I'd jump on it. I already own some solar bonds, but they don't seem to be offering those any more, perhaps because they've moved away from the earlier system of installing solar at no cost to homeowners and selling them the electricity.

    As a general philosophical notion, it seems to me that taking a company private while still having shareholders is basically an end-run around SEC rules intended to protect shareholders. What does it really mean other than the shareholders no longer have any rights? How can a company be "private" if it's still owned by shareholders? Will the shareholders still have a vote on stuff?

    I'm torn, because I totally support Elon Musk in his goal with Tesla to build electric transportation, and I totally love my Model 3, and I agree that the market is a P.O.S. that makes things harder for Tesla, but I fail to understand the concept of "going private" while still having shareholders. What's the difference between a public company, and a private company that's owned by a broad base of shareholders, other than loss of rights by the shareholders and the inability to sell their shares whenever they want?
     
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