SAN FRANCISCO (AP) — Elon Musk Enigmatic personality and unconventional tactics Tweeting – one of his most polarizing endeavors – emerges as a key exhibit in the trial.
The trial, which centered on a pair of tweets in 2018 announcing that Musk had received money to take Tesla private, turned the 51-year-old billionaire into three days of testimony in a federal courtroom in San Francisco about his often inscrutable mind.
Musk, who? Now owns the Twitter service He uses it as his megaphone, a study that often contrasts during his nearly eight hours on the stand. The electric car maker’s CEO is facing a class-action lawsuit on behalf of Tesla shareholders, over Musk’s tweets about a failed purchase of the company.
By both His testimony And the evidence presented around it shows that Musk has found inspiration, bravado, belligerence and contempt for anyone who questions his intentions as a game-changing entrepreneur that has inspired comparisons with Apple’s late co-founder Steve Jobs.
At other times, Musk has appeared to be the ardent visionary that his supporters hail him as — a brash rebel who, by his own estimation, has raised more than $100 billion from investors. They’ve had plenty of rewards from the leadership of pioneering companies that include PayPal in digital payments, Tesla in electric vehicles and SpaceX in rocket ships.
“Because my track record is so good, it’s relatively easy for me to get investment backing,” Musk sneers.
But his Confidence in his ability He is the reason why he wants to get the money he wants to continue his projects He found himself at court. The three-week trial will resume on Tuesday and will lead to jury deliberations by Friday.
Here’s what you need to know so far:
Planting the seeds
Evidence and testimony show that Musk began taking Tesla private in 2017 so he wouldn’t have to bother with the headaches and distractions of running a publicly traded company.
On July 31, 2018, after meeting with a top representative of Saudi Arabia’s sovereign wealth fund, Musk sent a letter to Tesla’s board explaining why he wanted to take the automaker private at $420 a share — about 20% above its stock price at the time.
He was already serious enough to discuss the pros and cons with Michael Dell, who was going through a public-private transition in 2013 when he led a $25 billion buyout of the public-private company, according to anecdotal evidence. .
The crux of the case is in a tweet Musk announced on August 7, 2018. “Financial Secured” To take Tesla personally. After being alerted by the Financial Times, Musk posted the tweet moments before boarding his private jet. Publish a story According to his testimony, Saudi Arabia’s Public Investment Fund has spent about $2 billion on a 5% stake in Tesla to diversify beyond oil.
Amid widespread confusion over whether Musk’s Twitter account had been hacked or if he was joking, Musk followed up hours later. Another tweet suggesting that a deal is imminent.
Musk defended the initial tweet It’s a well-intentioned move to ensure all Tesla investors are on track to end its eight-year run as a publicly held company.
“I had no ill intentions,” Musk testified. “My mission is to do the right thing for all stakeholders.”
Kuhan Subramanian, a Harvard University business and law professor hired as an expert for shareholder advocates, derided Musk’s method of announcing a potential buyout as a “huge outlier” fraught with potential conflicts.
“The risk is that Mr. Musk has made the announcement of his (management buyout) proposal to serve the company’s interests instead of his own,” Subramanian testified.
Where is the money?
There is another issue that threatens to undermine Musk’s defense. Musk, based on testimony from other witnesses and other sources, has not locked down financing for his proposed deal or put down how much it would take to pull it off.
That’s one reason U.S. District Judge Edward Chen ruled last year that Musk was 2018 The tweets are false And he instructed the jury to see them as such.
It also prompted regulators to accuse Musk of misleading investors with tweets that resulted in a $40 million settlement With the U.S. Securities and Exchange Commission calling for Musk to step down as chairman of Tesla.
Chen’s 2018 settlement, in which Musk did not admit wrongdoing and later lamented doing so, cannot be referred to the jury.
On July 31, 2018, Musk testified that he had received an oral commitment to provide funds for the Tesla purchase in a face-to-face meeting with Yasir al-Rumayan, the governor of Saudi Arabia’s wealth fund.
This was reinforced in the testimony of Deepak Ahuja, Tesla’s former chief financial officer, who was present at the discussion and took al-Rumaian on a half-hour tour of a Tesla factory.
But al-Rumi’s text message to Musk after the “funds are secure” tweets appeared to be preliminary to discussions about a Saudi Arabian fund financing a private buyout.
According to a transcript submitted as evidence at the trial, Al-Rumaian wrote to Musk, “I would like to hear your plan for Elon and what the financial calculations are for taking it on.
Musk framed al-Rumayan’s speech as an attempt to backtrack on his earlier commitment. He also stressed that Saudi finance has made an “unambiguous commitment” to finance the purchase.
After his 2018 tweets, Musk sought the help of Econ Durban, co-CEO of Silver Lake, the private equity firm that financed Dell’s 2013 purchase, to raise the money needed to buy Tesla. A top executive at Goldman Sachs, an investment banking firm, worked closely with Tesla.
In testimony, Durban and Dees discussed efforts to raise money to buy Tesla from a range of investors, including two Chinese giants Alibaba and Tencent and Google. Project Titanium.”
According to the documents, the buyout would cost anywhere from $20 billion to $70 billion — both Durban and Dees testified — because Musk canceled a plan to take Tesla private on Aug. 24, 2018, after consulting with shareholders.
After adjusting for two stock splits, Tesla’s stock is now worth eight times what it was then.
Musk still argues that he could have gotten the money if he wanted to, and even if there was a shortfall, he could cover any shortfall by selling some of his shares in privately held SpaceX. It’s a strategy Musk used in his $44 billion acquisition of Twitter, except for him He sold about $23 billion of his shares in Tesla.
Both Durban and Dees testified that they had no doubt the money could have been raised for a buyout — echoed by former Tesla director Antonio Gracias.
“He’s the Michael Jordan of fundraising,” Gracias testified.