- Elon Musk said on Friday that it is now “impossible” to make Tesla private.
- “The duties of Tesla’s public companies are a much bigger factor, but going public now is impossible (sigh),” tweeted Musk.
- In response to another user, Musk said that “the company’s engineering, design and general operations” were a “fundamental limitation” to devoting more time to innovation.
- He also said it was “likely” that Starlink, SpaceX’s Internet satellite project, would go public “once revenue growth was reasonably predictable”.
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Elon Musk said on Friday that it is now “impossible” to make Tesla private – although that could lead to further innovation at the electric car maker.
Tesla’s share price is almost eight times higher than at the beginning of the year, and it entered the S&P 500 as its fifth largest member on December 21.
Musk, responding to YouTuber Dave Lee’s comments on Twitter, said friday that “engineering, design and general company operations” were a “fundamental constraint” to devote more time to innovation.
“The bonds of Tesla’s publicly traded company are a much bigger factor, but going public now is impossible (sigh),” he tweeted.
The term “IPO” refers to the conversion of a publicly traded company into a private entity through, for example, a private equity acquisition.
—Elon Musk (@elonmusk) December 25, 2020
Tesla’s market capitalization of more than $ 600 billion would make it the largest acquisition of all time.
In August 2018, Musk said he wanted to make Tesla private, in comments that got him in trouble with the Securities and Exchange Commission (SEC).
“I’m thinking of closing Tesla for $ 420. Guaranteed financing,” Musk tweeted at the time. The SEC argued that Musk did not have a solid business in place and therefore made the statement knowing or having reason to know that it was “false and misleading”.
He was forced to step down as Tesla’s president.
Starlink IPO ‘likely’
On a tweet later, Musk said Starlink, his aerospace company’s SpaceX satellite internet project, “would likely” leave SpaceX and go public “as soon as revenue growth was reasonably predictable”
Starlink is currently in public beta and participation costs $ 600 in cash. About 900 satellites are transmitting internet to parts of the US and Canada, and some users report speeds of more than 200 megabits per second.
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Musk plans to take Starlink to other places in the world, including Europe, in 2021, and in early December, SpaceX won $ 885 million in federal grants to expand Starlink to other places in the United States.
In total, SpaceX plans to put up to 42,000 Starlink satellites into orbit. The goal is to provide high-speed internet to almost every location on Earth and generate $ 30 billion to $ 50 billion in annual revenue.
This is not the first mention of Starlink going public. “At the moment, we are a private company, but Starlink is the right kind of business that we can go ahead and go public,” said Gwynne Shotwell, chief operating officer at SpaceX, in February, according to Bloomberg. “This particular piece is an element of the business that we are likely to go public and go public.”