Shares of Tesla fell on Wednesday (Aug 15) following reports USA securities regulators have subpoenaed the electric vehicle manufacturer's Chief Executive Elon Musk over his statements about taking the company private.
The stock closed almost 2.6% lower at $338.69 a share, shedding some recent gains.
Musk himself sought to justify the tweet in a lengthy blog post on Monday, stating that Saudi sovereign the Public Investment Fund (PIF), which has an estimated $250bn of assets, had expressed support for a buyout deal after building a 5 per cent stake.
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Both Tesla and the SEC declined to comment on the matter.
Elon Musk, CEO of Tesla Motors Inc., unveils the companyís newest products, Powerwall and Powerpack in Hawthorne, Calif., Thursday, April 30, 2015.
Markets Insider reported Tesla's current price at $335.05, a -1.07% drop in the last 24 hrs. Some board members have urged Musk to stop using Twitter, and the board's independent directors recently hired a law firm to represent it as the SEC investigation progresses.
Despite the Saudi Fund having over $250 billion in assets, enough to purchase Tesla, numerous fund's assets are not liquid and readily available cash is limited. Official of Saudi's PIF have said it is not interested. Assets owned by the PIF can not be monetized quickly without driving down prices in the local stock market, while selling many of them would conflict with another of the PIF's declared roles. There are also four lawsuits filed againts Tesla and Musk for misleading investors. The report cites "a person familiar with the matter".