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SEC investigating Musk's 'taking Tesla private' tweet?by Justin King
Jim Cramer suggests Tesla won\'t face much scrutiny unless Musk \'dumps the pump.\'
The Securities and Exchange Commission is reportedly scrutinizing Tesla CEO Elon Musk's recent Twitter announcement that the company is considering going private.
Musk apparently consulted with Tesla's board before issuing the surprising Twitter message, which declared he is "considering taking Tesla private" at $420 per share and funding has already been "secured."
The announcement sparked an immediate surge in Tesla's stock price. NASDAQ briefly halted trading in the afternoon.
The Wall Street Journal now suggests the SEC is investigating to determine if Musk "had a factual basis" for issuing the Twitter post, which clearly stated that funding had already been secured and the move would go forward after a shareholder vote.
Mad Money host Jim Cramer suggests the SEC will be unlikely to take action if Musk "doesn't dump from what is clearly a pump," meaning sell part or all of his stake at a profit driven by share price surge following the announcement.
Musk has promoted going private as a way to avoid the regular distractions that have plagued Tesla each quarter. The executive has also argued that short sellers have waged a constant PR campaign against the company.
If the company does go private, current shareholders will be able to carry over their stake in the private entity. SEC unlikely to investigate if Elon Musk doesn't 'dump the pump,' says Jim Cramer from CNBC.
SEC unlikely to investigate if Elon Musk doesn't 'dump the pump,' says Jim Cramer from CNBC.