SEC has reportedly made inquiries to Tesla over Musk's tweet about possibly taking company private

The U.S. Securities and Exchange Commission has made inquiries to Tesla over CEO Elon Musk’s tweets about taking the company private, reported Dow Jones on Wednesday, citing sources.

But since then he has provided no details on the source of the funding, which would be substantial. At $ 420 a share Tesla would be valued at about $ 71 million.

Following the series of tweets, Tesla posted a letter Musk had sent to employees that said he wants to take Tesla private to remove the distracting attention Tesla receives from the public, including short sellers.

The SEC asked whether the statements Musk made on Tuesday were true and why he chose to disclose his plans on Twitter, Dow Jones reported, citing sources.

Tesla and the SEC did not immediately respond to a request for comment from CNBC.

Musk is not prohibited from disclosing his plans on social media, however the move was widely seen as being highly unusual, especially since Musk already announced the price at which he wants to buy out shareholders.

“That is what is so weird about this” Wayne University law professor Peter Henning told CNBC. “It’s backwards corporate governance. You don’t announce a price and then negotiate.”

Tesla shares closed down more than 2 percent at $ 370.34.

Read the full story at the Wall Street Journal.

This story is developing. Please check back for updates.

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