Tesla shareholder Ark Invest opposes Elon Musk take-private bid; predicts USD 700-USD 4000 share price in five years
24 AUG 2018
Tesla Inc [NASDAQ:TSLA] shareholder Ark Invest has written to the Palo Alto, California-based electric car manufacturer’s board to register its opposition to the proposed take-private bid from Tesla Chief Executive Elon Musk. A report in The Times on Friday, 24 August, quoted Ark Invest’s Chief Executive Catherine Wood, who wrote to Tesla’s board in an attempt to dissuade Musk and the board from proceeding with Musk’s USD 420-per share proposed takeover.
Wood cautioned against allowing the “short-term” concerns of professional investors to persuade the board to take the company private. She further said that in about five years, Tesla shares could range from USD 700-USD 4000, a considerable increase than USD 320.62 being traded at yesterday.
A privately-owned Tesla would not be able to take advantage of its competitive strengths as quickly and to the same extent as would be possible as a listed company, Wood argued.
Wood went on to argue that taking Tesla private would mean it would no longer receive the “free publicity” that it receives due to Musk’s position as CEO and that doing so would deprive most individual Tesla shareholders of a key investment opportunity.
Approximately 12% of Tesla’s shareholders are private investors, the report said, citing data from Factset.
Ark holds a stake of about 0.26% in Tesla, according to the newspaper.
Tesla’s share price closed USD 1.54 down at USD 320.10 at the close of trading in New York on Thursday, 23 August, giving the company a market capitalisation of USD 54.60bn (EUR 47.21bn).
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