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The reference to the company's stock is particularly relevant because Tesla shares immediately skyrocketed in the wake of Musk's tweet.

The hedge funds betting on a slump in the Tesla share price are holding their nerve amid mounting scepticism that Elon Musk can muster the $82 billion he will need to take it private.

David Whiston, an equity strategist at Morningstar who covers the USA auto industry, said he was confused by Musk's tweets, which he said indicated Musk had both the funding and the shareholder votes necessary to take the company private.

The Securities and Exchange Commission has opened an inquiry into the wording and method of Musk's disclosure about the potential deal, according to a Wednesday report in The Wall Street Journal, which cited unidentified people familiar with the matter.

In a statement on Tesla's website, six of Tesla's nine directors said the board had met several times over the last week to discuss such an idea and was "taking the appropriate next steps to evaluate this". "Tesla ignored the approach, prompting PIF to begin acquiring shares in the company through stock markets, with the assistance of JP Morgan".

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Once private, Tesla would have to continue filing public financial reports with the SEC if it has more than 300 shareholders. 9, Tesla shares have dropped back to near the level they were trading at before CEO Elon Musk tweeted Tuesday that he may take the company private. "And, if you stay as a shareholder, you have less information than before and you are depending more and more on Elon Musk".

However, in the recent earnings call, Musk denied the company needs more money, saying it wouldn't be going back to the capital markets. Musk's bold claim that Tesla already has the funding in place to delist itself from the public glare of the stock exchange has yet to be verified. Musk has feuded publicly with regulators, critics, short sellers and reporters, and some analysts suggested that less transparency would be welcomed by Musk. People with or close to 15 financial institutions and technology firms who spoke on the condition of anonymity said they weren't aware of financing having been locked in before Musk's tweet.

Some on Wall Street shared that view.

The company faces a make-or-break moment in its eight-year history as a public company as competition from European automakers is poised to intensify with new electric vehicles from Audi and Jaguar, with more rivals entering the market next year. The fund owns between 3% and 5% of Tesla's total stock, meaning the stake is likely worth $US1.7 billion to $US2.9 billion.

In a Wednesday research note, Morgan Stanley analyst Adam Jonas estimated Tesla will end up taking on about $50 billion in additional debt if the company goes private.


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