Volkswagen was in on bid to make Tesla private
2nd Sep 2018 6:00 am
WSJ report claims the German carmaker was one of the investors ready to take Tesla private; Elon Musk has not shared further details about this.
A report from The Wall Street Journal claims that Volkswagen was one of the companies standing in line as a potential investor making a bid to take Tesla private, alongside private equity firm Silver Lake and a Saudi sovereign wealth fund. Tesla CEO Elon Musk confirmed on Friday that the Silicon Valley Company will remain a publicly traded company after the deal fell through.
It has not yet been made clear exactly why Musk changed his mind about taking Tesla private; but the WSJ report suggests that the CEO balked at the proposal of relinquishing further control of his company to secure the investment.
The investment necessary to take Tesla private was estimated at around $30 billion. Volkswagen, was looking to make a substantial commitment for the same. The German car giant wouldn’t be the first carmaker to attempt to hold a stake in Tesla. Toyota and Daimler both invested in the EV start-up’s early years.
Meanwhile, Elon Musk may be facing an investigation at the hands of the Securities and Exchange Commission after he tweeted about taking Tesla private at $420 (around Rs 29,000) per share and claiming that the funding to do so was “secure”. At that point, no board statement or regulatory filings had been made to confirm this.
The attempted move by VW to invest in a major EV player such as Tesla could be seen as a quick way to gain a strong foothold in the EV market – a desire expressed by the automaker for VW's US operations and overall long-term strategy.
Volkswagen is expected to launch “practically one new electric model per month” from 2022, according to a statement made by CEO Matthias Müller a few months ago. The VW ID hatchback will be the company’s first purpose-built EV and is due to launch in 2020.