TSLA Market Action: 2018 Investor Roundtable

[Thumper]

Present shorts will remain implacable foes of Tesla no matter which way this proposal goes. If they are driven out they will bitterly claim until their dying day that they were right about TSLA and should have made a ton of money if not for that sneaky Elon. They will still try to sabotage the private company just for bitterness and spite.

 

[Tslynk67]

One thing I've learned since becoming a share-holder is that $TSLA moves in mysterious ways...

 

[Runarbt]

Present shorts will remain implacable foes of Tesla no matter which way this proposal goes. If they are driven out they will bitterly claim until their dying day that they were right about TSLA and should have made a ton of money if not for that sneaky Elon. They will still try to sabotage the private company just for bitterness and spite.

If mark turn into the crazy hobo on the street corner yelling "Tesla is zero" and throw crap at ppl, so be it. ;-)

 

[neroden]

Revhappy2 wrote:

Tesla "is an operationally stressed co", and @elonmusk wants to raise its fixed costs? "If he thinks short-sellers are bad, try dealing with LBO debt-holders. That's gonna be worse for him because they're going to seize the assets. I don't get it at all." - @RBAdvisors on @CNBC

https://mobile.twitter.com/CNBC

I think this buyout offer isn't gonna be particularly leveraged, if it's the billionaires I'm thinking of.

 

[Bet TSLA]

I think the timing is NOT coincidental. I think the going-private plan has been in progress for a while...

Yes. But I think one other important consideration for those thinking this will happen quickly is that people who don't want this to happen will try to tie it up in the courts. That process could possibly take years. Thus we see prices today far below $420.

 

[mongo]

Musk also said they'd have full self driving completed several years ago.

Musk is *honest* in that he says what he believes is true and he attempts to do what he says. However, he is *not always correct*.

In his letter to employees, he said the way he *envisioned* Tesla going private, but from what I know of the legalities? I don't believe it's actually possible. Musk is not going to convince hundreds of 401(k)-operating employers to change their regulations; he is not going to get Canadian law changed on whether RRSPs can hold foreign private equity; etc.

In saying "definitely no forced sales" in combination with going private, he is promising the *impossible*. Just like promsing full-self-driving on too short a timeline.

I'm pretty sure he can make sure investors who *own their shares outright* will be able to keep them... I am sure Musk will do his best to design a deal with the minimum number of forced sales... but he doesn't have control over dozens of governments and thousands of retirement plan administrators. There are a lot of plans which simply don't allow for holding non-listed shares.

I think Elon is speaking as far as he can control. His plan is not to exclude anyone, but he has no control over the requirements of plans people are in.

 

[pyromatter]

Statement from the following members of Tesla’s Board of Directors: Brad Buss, Robyn Denholm, Ira Ehrenpreis, Antonio Gracias, Linda Johnson Rice, and James Murdoch | Tesla, Inc.

 

[T-Will]

One bear says...

 

[lunitiks]

 

[bhtooefr]

OK, hang on a second, re: the Canadian thing.

The rule that's been quoted only applies to Canadian companies.

It looks like there's a separate rule for companies on listed stock exchanges, which Tesla would cease to be. What's not clear is if there's an exception for a company that became delisted, but the document says that there usually is an ongoing requirement (that is, when Tesla becomes unlisted, they no longer qualify).

IANAL though.

1.11 Generally, the conditions that must be met for an investment to be a qualified investment apply on an on-going basis. However, several provisions contain conditions that apply only at a point in time, typically on acquisition of the investment by the registered plan. Where this is the case, it has been noted in the section of the Chapter describing that investment.

1.16 Except for certain derivatives, any security that is listed on a designated stock exchange (as described in ¶1.17) is a qualified investment. This accommodates a wide range of listed securities, including:

• shares of corporations;
• put and call options;
• warrants;
• debt obligations;
• units of exchange-traded funds;
• units of real estate investment trusts;
• units of royalty trusts; and
• units of limited partnerships.

Futures contracts and other derivative instruments in respect of which the holder's risk of loss may exceed the holder's cost are not qualified investments. The fact that a broker may be willing to put in place an arrangement to close out a futures contract so as to minimize the possibility of the registered plan going into a loss position does not overcome this restriction.

1.17 A designated stock exchange is defined as a stock exchange, or a part of a stock exchange, for which a designation by the Minister of Finance under section 262 is in effect. The list of designated stock exchanges is published on the Department of Finance Canada website.

1.18 Over-the-counter (OTC) quotation systems, such as the OTC Bulletin Board and OTC Link ATS (formerly Pink Sheets) in the United States, are not designated stock exchanges. As a result, securities that trade on OTC markets are generally not qualified investments. However, OTC securities can still qualify if they are cross-listed on a designated stock exchange or if the securities meet other qualification conditions such as those that apply to certain Canadian small businesses (see ¶1.55 - 1.66).

NASDAQ is one of those designated exchanges, which is how TSLA can be held today.

 

[Fact Checking]

I think this buyout offer isn't gonna be particularly leveraged, if it's the billionaires I'm thinking of.

Would their first names be Larry, Sergey, Warren and Bill, by any chance?

 

[Revhappy2]

Douglas Kass
@DougKass
If the Board of $TSLA had discussions of going private at $TSLA a week ago, why wasnt it disclosed in Monday's 10Q filing? @jimcramer @davidfaber @carlquintanilla

 

[blee321]

Off topic here. For those that own TSLA in our 401k's what will be the future of our holdings?

I am considered by the SEC an accredited investor.

 

[Causalien]

Yep yep. They just found out about the Saudi money, and released the "considering taking it private" news the *same day*. I think the timing is NOT coincidental. I think the going-private plan has been in progress for a while but it had to be revealed early, because he wants to lock the Saudis out of increasing their share further, and prevent them from gaining control.

I suspect his buddies who are providing funding don't like the Saudis much either.

Putting the company into "tender offer" play may be the best move to lock out the Saudis, though if the Saudis make their own tender offer... things would get sticky. I wouldn't tender my shares to the Saudis even if their offer was much higher, though; that government has been so evil that my rather minimal "ethical investing" filter kicks in.

Yep. Don't like the Saudi money either. They corrupt the cause.

 

[Robocop]

Statement from the following members of Tesla’s Board of Directors: Brad Buss, Robyn Denholm, Ira Ehrenpreis, Antonio Gracias, Linda Johnson Rice, and James Murdoch | Tesla, Inc.

Just last week this started?

 

[Lhan]

shorts going all in premarket? or profit taking??

Short selling i think, i'm having difficulties getting my buy order filled.

 

[Johan]

Short selling i think, i'm having difficulties getting my buy order filled.

Same here. My broker has done pre-market trades for me before, but my buy with a limit of $377 still hasn't filled.

 

[Big Earl]

I picked up a couple more shares in pre-market.

 

[mongo]

One bear says...

View attachment 323996

A consortium with ~ 50% of the shares would beg to differ.. (though they did get in <420)

Huh...
If you were a consortium and planned to take Tesla private, and needed to buy out people at $420, but the stock was currently in the $300's, would you not buy up as much as possible to reduce the amount you would need to pay later? If so, could it be they have cornered 100% of the float, and the only trading that has been occurring has been with borrowed shares?

So:
Announce $420
Price goes up
Shorts forced to cover above $420, those that want out of TSLA sell to the shorts, eliminating a position that need to be absorbed.
Final tally: if there are more short shares than shares of people who want out, there is high cost problem for shorts. If there are more getting out shares than short shares, the consortium only needs to buy the difference...

Is there any reason for the consortium to NOT have already acquired 100% of share count?

Not an advice, but this makes me either very worried (for shorts), or very impressed.

 

[Fact Checking]

Statement from the following members of Tesla’s Board of Directors: Brad Buss, Robyn Denholm, Ira Ehrenpreis, Antonio Gracias, Linda Johnson Rice, and James Murdoch | Tesla, Inc.
"Aug. 08, 2018 (GLOBE NEWSWIRE) -- Last week, Elon opened a discussion with the board about taking the company private. This included discussion as to how being private could better serve Tesla’s long-term interests, and also addressed the funding for this to occur."

edit:

• Note the past tense for "addressed the funding", i.e. I believe this means that the board sees funding as secured.
• Also note that the board confirms that the offer is legit and is being considered. It's not a Twitter joke or bluff by Elon.
• Obviously the board is an independent entity separate from the buyout consortium of the buyers, and board approval has to be in the interest of shareholders - so Tesla board approval could not be given yet (nor expected), but this is giving Elon's announcement plenty of legitimacy: those who do not trust Elon's word might trust the word of a certain James Murdoch.
• Also note the timing: released shortly before trading opens - probably with an intent to reduce uncertainty.