- Elon Musk's famous "funding secured" tweet from 2018 was entirely truthful, the Tesla CEO's lawyers said on Tuesday.
- "Funding was secured. There was investor support," a heavily redacted court filing said.
- In 2018, Musk and Tesla made a $40 million settlement with the SEC over allegations he had misled investors.
Elon Musk's 2018 tweet about possibly taking Tesla private was genuine, lawyers representing the billionaire have said.
In a court filing seen by Insider, Musk's lawyers said Saudi Arabia's wealth fund had indeed agreed to fund a buyout of Tesla four years ago.
In August 2018, Tesla CEO Musk said he was considering taking the electric-car maker private at $420 per share and that he had secured funding to do so. That share price would be 20% higher than where it was trading on the day — around $371 a share.
A public company has the option to go private if a buyer agrees to acquire the majority of its shares.
—Elon Musk (@elonmusk) August 7, 2018
"Elon Musk's August 7, 2018 tweet informing the public that he was considering taking Tesla private was entirely truthful," attorney Alex Spiro said in a heavily-redacted filing.
"Mr. Musk was considering taking Tesla private at $420 a share. Funding was secured. There was investor support."
Those conclusions were backed up by a lot of evidence from that time, including discussions with Saudi Arabia's Public Investment Fund and Tesla's board, according to the Tuesday filing.
There was also the "undisputed fact" that there was sufficient funding for a transaction to take Tesla private, whether from that fund or otherwise, the lawyers added.
The filing was made in a class-action lawsuit brought by multiple investors in San Francisco federal court in 2018, claiming damages after allegedly suffering hundreds of millions of losses after Musk's comment on Twitter.
Tesla stock rose 13% after the tweet about going private, hurting short-sellers in the process. Other investors who considered this as a buying opportunity were also impacted, as Musk's failure to clarify the deal ended up in turmoil for the stock.
The tweet also got Musk into trouble with US regulator the Securities and Exchange Commission.
Days after the tweet, Musk defended putting out information about wanting to privatize Tesla by saying it was the "right and fair thing to do."
He said at the time that Saudi Arabia's sovereign wealth fund, which had recently bought a 5% stake in Tesla, had been confident about striking a deal to take the company private.
"I left the July 31st meeting with no question that a deal with the Saudi sovereign fund could be closed, and that it was just a matter of getting the process moving. This is why I referred to 'funding secured' in the August 7th announcement," Musk said in a company statement.
Eventually, Musk and Tesla reached a $40 million settlement with the SEC over allegations he misled the company. Musk also agreed to resign as chairman for at least three years and have Tesla lawyers review his personal social media posts in advance.
"Far from 'fraud,' Mr. Musk's statements were an effort to be open about a potential go-private transaction and to provide equal information to all Tesla shareholders," his lawyers said in the filing.
Saudi Arabia's Public Investment Fund exited from its stake in Tesla last year, missing out on a huge windfall.