Elon Musk indicates taking Tesla private as he posts 'funding secured' tweet

Elon Musk indicates taking Tesla private as he posts 'funding secured' tweet

Musk's tweet said he's secured funding.

Musk also tweeted he would remain CEO of the electric carmaker even if it ceases to be publicly traded.

Chinese internet company Tencent took a stake in Tesla through stock market purchases early a year ago, paying out about $1.7 B to amass its position.

"We're working on a new Tesla mini-car that can squeeze in an adult", Musk tweeted on Sunday, replying to a user who asked him about a "Model X Radio Flyer" toy auto.

"The short position is the best thing the stock has going for it. "Musk vs The Shorts" is a far better narrative than 'Tesla vs Mercedes/Audi/Porsche, '" Chanos said.

Tesla said in a regulatory filing in 2013 that investors interested in keeping up with Tesla should follow Musk's account.

Wall Street jumped on the news, spiking Tesla stock from around $342 a share to a high slightly north of $370 in just 45 minutes.

Meanwhile, Twitter was on fire with speculation - debating the seriousness or legitimacy of Musk's announcement.

In contrast, private companies have a smaller number of shareholders-generally fewer than 2,000-and are not available for purchase on public markets.

A short squeeze is a trading scenario that occurs from time to time in heavily shorted stocks, when bearish traders are forced to buy shares to avoid big losses - something that ends up pushing the stock only higher.

Tesla did not immediately respond to a request for comment.

The Financial Times is reporting that Saudi's Public Investment Fund (PIF) has built a significant stake in Tesla - to the tune of between 3% and 5% of the all-electric vehicle maker's shares this year. Taking Tesla's shares out of public markets would make it much more hard for people to engage in short selling of Tesla's stock.

Palo Alto-based Tesla, named after the physicist Nikola Tesla, went public in 2010. Others interpreted the tweet as a joke, in specific Musk's reference to "420": a popularized reference to the consumption of cannabis by the marijuana culture.

The stock was halted at $367 a share shortly after 2 p.m. (ET), as some grew concerned that Musk's tweets were an attempt at market manipulation.

The company had a market value of US$58 billion as of Monday's close.

Shares have rallied strongly since those earnings, but Musk has continued to show a short fuse towards critics, lambasting "short" sellers of Tesla shares - those who take bets that the stock will fall in value.

Before its recent rally, Tesla's share price had been in a downward spiral for much of the summer, as the company struggled to meet production targets for its midrange Model 3 sedan.

Musk did not elaborate how he had secured the funding that he had mentioned in his tweet - or which lender was leading the effort.

Musk's relationship with shareholders and analysts has been rocky, to say the least.

"I fundamentally believe that we are at our best when everyone is focused on executing, when we can remain focused on our long-term mission, and when there are not perverse incentives for people to try to harm what we're all trying to achieve", he wrote.