San Francisco: Paying heed to his investors' feedback, Tesla Chairman and CEO Elon Musk has decided not to veer the electric carmaker off the road and let it remain a publicly traded company to stay focus on becoming profitable.
On August 7, Musk surprised the investment world with a Twitter announcement that he was considering taking Tesla private and that the funds needed to do so were "secured".
Musk's tweet caused a financial firestorm with Tesla shares immediately skyrocketing. But in later days, they lost a good part of what they had gained and tanked further over the confusion which way Tesla might go.
In a blog post late on Friday, Musk took a U-turn, saying his investors were extremely important to him.
"Almost all have stuck with us from the time we went public in 2010, when we had no cars in production and only a vision of what we wanted to be.
"Given the feedback I've received, it's apparent that most of Tesla's existing shareholders believe we are better off as a public company," Musk wrote.
This came after Musk had discussions with existing shareholders and financial advisors and learned that there was little appetite for such a move.
"Additionally, a number of institutional shareholders have explained that they have internal compliance issues that limit how much they can invest in a private company. There is also no proven path for most retail investors to own shares if we were private," said Musk.
"Although the majority of shareholders I spoke to said they would remain with Tesla if we went private, the sentiment, in a nutshell, was 'please don't do this'," he added.
Since the Musk announcement came over the weekend, its impact on Teska stock will only be visible when the US market reopens on August 27.
Musk said he worked with investment firms like Silver Lake, Goldman Sachs and Morgan Stanley to consider the many factors that would come into play in taking Tesla private.
He also spent considerable time listening to current shareholders, large and small, to understand what they think would be in the best long-term interests of Tesla.
"I knew the process of going private would be challenging, but it's clear that it would be even more time-consuming and distracting than initially anticipated. This is a problem because we absolutely must stay focused on ramping Model 3 and becoming profitable," Musk said.
In an interview to The New York Times this month, Musk spoke about "excruciating" times and long working hours at Tesla, noting that he "nearly missed his brother's wedding this summer and spent his birthday holed up in Tesla's offices as the company raced to meet elusive production targets on a crucial new model".