Musk Confirms Saudi Sovereign Fund Wants To Pull Tesla Off Market

Part Of Saudi's Life After Oil Plan City Of Neom For Robots Not Humans

Tesla has not received a formal proposal from its founder Elon Musk to take the company private, its board of directors has said.

On Monday, he said financing had been discussed with Saudi Arabia.

Shares in Tesla, which are still well below highs hit when Musk initially raised the prospect of the transaction last week, inched up 0.7 percent in trading before the bell.

Earlier, Musk wrote that in late July, he met Saudi Arabian sovereign fund representatives to discuss the electric carmaker's possible exit from the stock market.

File photo of Elon Musk. Musk wrote that he tweeted the plan August 7 after "it was clear to me that the right thing to do was announce my intentions publicly".

Musk's disclosure, made in a blog post on Tesla's website, comes six days after the Silicon Valley billionaire shocked investors with a post on Twitter saying he was considering taking Tesla private at $420 a share and that funding was "secured".

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Saudi Arabia's Public Investment Fund (PIF) manages more than $230 billion in assets, but about 65 percent of that is stakes in large Saudi companies and most of the rest has been committed in overseas deals such as funding commitments to Blackstone Group LP's USA infrastructure fund or SoftBank Group Corp's Vision Fund. In his proposal, existing shareholders could remain as they are in a private Tesla, or agree to the buyout amount per share.

He added that most capital for the deal would come from equity and it would not be "wise" to burden the company with added debt.

Since going public on Twitter, Musk said he has "continued to communicate with the managing director of the Saudi fund", and that "he has expressed support for proceeding subject to financial and other due diligence and their internal review process for obtaining approvals".

PIF officials have said in the past that decisions at the sovereign wealth fund are made with care, emphasizing corporate governance. Bloomberg's sources also came to a similar conclusion over the weekend, although separate people familiar with the matter told Reuters that it is unlikely that the Saudi fund is a credible candidate as SoftBank Group, one of its investments, is backing rival firm General Motors Co.

The billionaire says the Saudis have been pushing him to take Tesla private for nearly two years, promising to back him up should he make this decision.

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