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ReportSaudi

Report: Saudi Arabia is looking to invest big in Tesla as the company teases going private

Report: Saudi Arabia is looking to invest big in Tesla as the company teases going private


tesla dubai

Tesla
opened its first Middle East showroom in Dubai last
year.

AP Photo/Kamran
Jebreili


  • While Tesla CEO Elon Musk
    teased last week
    about taking the company private, several
    suitors may have already been courting the electric car giant
    months ago.
  • Saudi Arabia’s Public Investment Fund, the country’s
    sovereign wealth fund, is in talks with Tesla about
    becoming a significant investor in the buyout, sources told

    Bloomberg
  • The fund has already built up a nearly 5% stake in
    the company.
  • Tesla may have already been courted by SoftBank last
    year, but sources have told
    Bloomberg
    that the Japanese conglomerate is no longer
    interested. 

While Tesla CEO Elon Musk
teased last week
about taking the company private, several
suitors may have already been courting the electric car giant
months ago.

Saudi Arabia’s Public Investment Fund, the country’s sovereign
wealth fund, is in talks with Tesla about becoming a significant
investor as part of the move towards privatization, sources with
knowledge of the fund’s plans
told Bloomberg
Sunday. 

The Saudi investment fund approached Musk months ago to discuss
acquiring a minority stake but was turned down as the company did
not plan on issuing new shares at the time, a source close to the
discussions told Bloomberg. In turn, the fund bought nearly $2
billion worth of Tesla shares on the market with the help of an
investment bank, building up a stake just short of 5% in the
company. 

The fund has not yet made any concrete plans with Tesla on
increasing its stake, sources told Bloomberg, but talks are
ongoing, and continued investment in the company is seen as a
strategic step toward diversifying the Saudi economy away from
oil.

Last week, Musk stunned investors
when he Tweeted about wanting to take Tesla private
at $420
per share before issuing a formal
statement
on the company’s website. The company
had a market capitalization of more than $60 billion last
week.

In his statement, Musk said that taking the company private is
“the best path forward,” and added that  a
shareholder vote must be held before a final decision is made. He
later
 tweeted that investor support was already
confirmed
.

Tesla was reportedly courted by
Japan’s SoftBank in April of last year
, though sources told

Bloomberg
 on Monday that the conglomerate isn’t planning
to participate in deals for Tesla’s buyout as it has already
vested interest in other auto makers and autonomous vehicle
programs, like General Motors. 

A Tesla investment would add to the Saudi fund’s long
growing list of high-profile purchases. The company has
invested $3.5
billion in Uber
in June 2016, teamed up with Softbank for a

$93 billion tech fund
 in May, and pledged to invest
about
$1 billion
in Virgin Group’s space companies, Virgin Galactic
in October. 

Get the latest Tesla stock price here.