TSLA Market Action: 2018 Investor Roundtable

[Boomer19]

Actually, voting shares can be lent out, but it is just that the lender will not be able to vote while the borrower can. (Exception is if the shares are lent out on the record date, in which case both the lender and the borrower can vote. ) Reference: https://www.mcgill.ca/desautels/files/desautels/Cgmr0704.pdf

The implication is that the number of shares recalled from the shorts prior to the record date depends on the lenders.

you can’t vote the same shares twice.
companies like mediant and broadridge, and recently a startup called say, handle this for brokers and their clients.

they know what each brokers record date settled position is at dtcc and when the brokers submit all their clients votes they must match.

if you don’t hold your own fully paid shares on r/d for a proxy vote, you can’t vote. focus on fully paid shares only, not margin shares. margin shares can go either way depending if your broker has them loaned or not on record date. it depends on your brokers seg requirements on that record date vs what they have loaned/borrowed, vs internal shorts, and if that calculation leaves free excess position in their dtcc custody account, which can be voted.

 

[Tslynk67]

Musk will go to jail no doubt about it. You cannot just tweet "Funding Secured" and then disappear like that.

Oh FFS, another one appears from the sewers...

 

[Starno]

"Final price may go up a bit" - but this is only relevant to those selling-out or the shorts having to buy, right? For those of us that stay with $TSLAP, there will be a new valuation as of day 1, I suppose?

Anyone any ideas on that? I guess it's irrelevant anyway, the first buy/sell event will be all that matters.

I think it will likely stay at $420/ about 70B.

 

[dondy]

Let's say you are a big investor who Elon has talked to about going private and you have agreed to take a certain percentage of the company

You could either buy shares now at a discount and transfer them over or you could wait and pay 420

Right now, only you and the other private investors Elon has talked to have the knowledge that this thing will go through because only you know he has the numbers.

So if Elon does have the numbers, we will find out very soon because there will be very intense buying of shares by these investors to avoid having to pay 420.

The number 420 will not be that important because most investors will get in before it gets there. It will only be the price paid to a minority of shareholders who cannot or do not want to continue with tesla private. This number will be raised likely to appease these shareholders but it won't matter much because the majority of shares will be trasferred over rather than bought.

I think we skyrocket today or tomorrow.

Not advice, just a feeling and could be wrong

It is called inside trading. None of these investors buy now.

 

[Tslynk67]

Sorry, hopelessly behind here, like 700 msgs, so apologies if this has been addressed.

I called Helpdesk at Nordnet Stockholm yesterday. The guy said I was only the second person to ask, and he thought it would be possible to own foreign private stock in a normal depot account (but not the tax shielded type since it's not traded). But of course it's still unclear what kind of asset the private Tesla (TSLAP?) will be, if this even happens at all.

I guess we are also waiting for word on details like voting, formal offer etc.

Right now I lean towards selling maybe half for cash in order to not be liquidity limited for an uncertain, long period and let the remainder be apported by "The Elon Special Ludicrous Assets Property" or whatever.

Ok, now back to my backlog ...

Feel free to join us here: Holding shares in a private Tesla outside the US

 

[Reality]

It is called inside trading. None of these investors buy now.

technically they could by now, as in after the tweet right?

Good question, honestly im not sure. I think most real players wouldnt, but who knows.

 

[Chickenlittle]

I agree in terms of execution (esp with no further cap raises) but every other aspect is impacted by short/ bear induced negativity and wall street induced near term profitability pressure.

Getting rid of the FUD machine will increase Tesla's credibility in the public eye.

I so agree with this. I have owned Tesla’s for over 6 years and am so tired of people asking/telling me FUD. these people are strangers but I strongly doubt they are investors. These articles not founded in truth but sink in with the public

 

[scaesare]

Musk will go to jail no doubt about it. You cannot just tweet "Funding Secured" and then disappear like that.

When it comes to investing, I'm a relative newb... so thank you for confirmation there are those out there more clueless than I.

 

[mongo]

You really should disclose that you are not a professional trader because posting stuff like this is dangerous

What was inaccurate?

 

[Krugerrand]

Well, as long as one wants to torture words to their waterboarding utmost, imagine this scenario at the Interstate’s margin where the Commercial Vehicle Patrol is interviewing the overturned truck’s driver:

“Did you secure your load of 60,000 lbs of pipe?”

“Oh, yes. I secured the load.”

“And with what did you secure it?”

“With twine.”

Point taken, except Elon isn’t the truck driver in this case. (And you know that). Elon has the funding all day long, every day for the $420/share. I’d bet my own money (which of course I have for 6+years, that he has funding for a price greater than $420/share - and I don’t mean 420.01/share so don’t be a smarty pants.

He’s probably been ‘thinking’ of taking Tesla private since the day after the IPO. And now he’s found the way and means. I’m super excited to find out the details in the coming days, weeks and months. I’m even excited to hear the whole story a few years from now at a shareholder’s meeting. Maybe this is another shoot out at the Mexican border story.

 

[Dan Detweiler]

Why not keep at least one to have a foot in the Golden Door of privatization.

That brings up a good point. Will there be an opportunity for new investors to buy in at any point if they go private? If not, I may just do what you suggest. I assume I could add to my position periodically if I was already in?

Dan

 

[dondy]

technically they could by now, as in after the tweet right?

Good question, honestly im not sure. I think most real players wouldnt, but who knows.

They can only after disclosing their intent. Basically after full Tesla intent disclosure. It will happen as close as possible to the end of Q3.
It is in Tesla's interest to keep current suspense as long as possible. They need to streamline shareholders composure and they need time for big institutional investors to make choices.

 

[Lessmog]

Sorry, hopelessly behind here, like 700 msgs, so apologies if this has been addressed.

I called Helpdesk at Nordnet Stockholm yesterday. The guy said I was only the second person to ask, and he thought it would be possible to own foreign private stock in a normal depot account (but not the tax shielded type since it's not traded). But of course it's still unclear what kind of asset the private Tesla (TSLAP?) will be, if this even happens at all.

I guess we are also waiting for word on details like voting, formal offer etc.

Right now I lean towards selling maybe half for cash in order to not be liquidity limited for an uncertain, long period and let the remainder be apported by "The Elon Special Ludicrous Assets Property" or whatever.

Ok, now back to my backlog ...

Feel free to join us here: Holding shares in a private Tesla outside the US

Thanks! I have just derailed my catchup, reading that thread.

 

[ZsoZso]

edit: understand that I'd love to see a short squeeze

I'm less sure we'll see a squeeze. It seems plenty of people are happy to sell here even at < $380.

If owners in IRAs or other retirement vehicles are forced to sell, that too will of course suppress any squeeze. There will be plenty of TSLA sellers for the shorts to buy from.

Why would the need of retirement/tax-free investors' need to sell suppress the squeeze below $420 ?
I am one of the investors who must sell , because my investment is in Canadian RRSP which does not allow foreign private investment. I just bought some more after the announcement. Why ? Because Elon's offer provides a guaranteed floor price of $420, so buying in the $370s is a clean short term win.

There is absolutely no pressure on me to sell the stock. I can wait until the de-listing date and take the $420/share as the worst-case scenario. If the price goes up due to forced buying of short-covering, then I may sell at a higher price.

It will all come down to a game of chicken when the cut-off date approaches and the shorts must cover. Currently there are 127% shareholders (due to dilution by shorts), maximum 100% can go private. What if the number of shareholders wanting to go private is over 100% ? Then the shorts are in big trouble, price to cover will go to literally infinite. OK, what if only 80% wants to go private and 47% wants to sell. Still, floor price is set by Elon at 420, no sense selling below that. Then it becomes the game of chicken. When the price goes to $450, will you sell or wait a bit more ? How many shorts are still left who must buy ? What if the price is $900 ? It is going to be interesting. The reality is that what percentage wants to sell and who wants to go private will depend on how high the price goes. For most longs (including myself) $420 is much lower than we value the company, so I would rather stay on as private investor than sell for $420 if I had that option. But if the price goes up much higher, say $1500, that may change that sentiment.

So I do not see any suppression or selling pressure below $420, that is the guaranteed minimum price to sell at this point and no rush for that.

 

[Krugerrand]

Coming from a legal background, it’s ambiguous because it doesn’t say how much financing is secured, or in what way it is secured. This actually works in Musk’s favor, not in favor of the shorts.

He didn’t say whether he had the full enterprise value secured, or just the enterprise value minus his shares. Or, perhaps, just the amount they anticipate needing to cash people out (possibly less than $30 billion). Which is good— no need to show his hand until he’s ready to play it. All the tweet means is that he’s serious.

Likewise for how the financing was secured. He didn’t say whether it was signed letters of intent, verbal agreements, or something else entirely. Again, all it means is that he’s serious. And I have no doubt that he is.

That doesn’t make what he said vague. It makes the details of the arrangement unknown.

I’m wearing socks. There’s nothing vague about that even though you don’t know if they are aqua and black with dolphin print and are both on my left foot.

 

[brian45011]

i’m not sure the 10-q requires future changes that are still in negotiation/not finalized.

once final, they should issue an SEC S-4

“The SEC form S-4 is submitted by companies going through an exchange offer and contains material information related to a merger or acquisition. The filing is needed by investors looking to make quick gains from mergers or acquisitions. Therefore, companies submitting SEC filing S-4 are required to disclose essential facts about their financial and operating activities”

10-q requirements:
https://www.sec.gov/files/form10-q.pdf

it doesn’t clearly state that ongoing negotiations about an exchange offer must be reported on a 10-q, but i’m not legal expert

Tesla has periodically included a paragraph captioned "Subsequent Events" in prior 10-Qs, announcing developments after quarter end but it is likely a matter of management discretion and dependent on how close the event was to submitting the filing to SEC.

 

[Reality]

It is in Tesla's interest to keep current suspense as long as possible. They need to streamline shareholders composure and they need time for big institutional investors to make choices.

Hmmm, not sure i follow, what investor choices would they care about if we assume all is secured as stated?

 

[Krugerrand]

I have a VERY hard time believing it's the Saudis. Maybe a small stake, but nothing dramatic. I'd assume it's more likely Page/Alphabet, Ron Baron, and the like. Maybe I'm naive.

I agree. Not Saudi or Chinese money.

 

[Reality]

Tesla has periodically included a paragraph captioned "Subsequent Events" in prior 10-Qs, announcing developments after quarter end but it is likely a matter of management discretion and dependent on how close the event was to submitting the filing to SEC.

there is guidance around subsequent events


https://www.aicpa.org/content/dam/a...uditattest/downloadabledocuments/au-00560.pdf


You are normally more versed than me at this stuff, but the way I read it is if funding was secured for a LBO, that would 100% need to be disclosed.


If the funding was probable, it needs to be disclosed.


So given the Q was filed on 8/6 and the announcement was on 8/7, one interpretation could be that it needed to close post the Q filing timestamp and have not been probable at that moment. Again that is one interpretation.

 

[Johan]

You really should disclose that you are not a professional trader because posting stuff like this is dangerous

Disclosure: I am not a professional investor. Please inform me what was wrong in my post. Thanks.

Mod: He can't any more. I deleted that and a number of other reaction posts for attacking another member. --ggr