Founder and current chief executive, Elon Musk revealed on Tuesday of his plans to make Tesla Inc. a private company - a move that could pluck out the electric car maker from the clutches and control of Wall Street.
The investment world was stunned this week when the South African business mogul tweeted that he got plans to take Tesla "private," with the funding of its operations already "secured."
In a follow-up letter to his constituents, Musk said that de-listing from the stock exchange would relieve the company of the current "enormous pressure" from Wall Street.
Being a public company, Tesla is "subject to [the] wild swings" of its stock price which consequently can affect the operation of the company.
"...we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla, all of whom are shareholders," Musk said in his letter.
Since Tesla is publicly listed, it also means that there are a lot of people, each with varying intents and purposes in mind, who have "the incentive to attack the company."
The 47-year-old business magnate has long been decrying about those shareholders and investors who short-sells and profit greatly when Tesla's stocks drop.
With so many involved hands out of the way, Tesla can take back control of its own reins. For Musk, this is the condition to which the company can "operate at its best, free from as much distraction and short-term thinking..."
Musk, meanwhile, confirmed that his decision to pull out Tesla from the New York Stock Exchange (NYSE) has been backed by shareholders. Although, they still have to take a vote for the move to be carried out.
In the same Twitter post, the CEO said that shareholders will be offered USD$420 per share, which is five times higher than its current price.
According to CBC, Tesla shares closed up 11 percent at USD$379.57, a tad lower from their record-high.
When asked on Twitter, Musk clarified that he would continue to take charge of the Palo Alto, California-based firm.
Although quite unconventional and less formal than when done in an official regulatory disclosure means, Musk's announcement on Twitter is in line with the laws set up by the US Securities and Exchange Commission.
The agency, according to BBC, allows firms such as Tesla to make use of any available means of broadcast, such as social media outlets, Facebook and Twitter, for example.
