Saudi's Public Investment Fund hasn't shown interest in financing Tesla

Source says that the Saudi fund would not make an investment of this kind without seeking guidance first from SoftBank

Saudi Arabia’s Public Investment Fund (PIF) has shown no interest so far in financing Tesla CEO Elon Musk’s proposed $72-billion deal to take the US electric car maker private, despite acquiring a minority stake in the company this year, two sources familiar with the matter said.
 

The 47-year-old stunned markets when he said on Twitter he was considering a take-private deal for Tesla, an auto manufacturing pioneer that developed the world’s first luxury all-electric sedan car. Musk also said he had secured funding for the proposal, without providing details. 
 

Investors and analysts viewed PIF as a natural financing partner. Beyond amassing a stake of just below 5 per cent in Tesla, the sovereign wealth fund has poured tens of billions of dollars into technology investments, including $45 billion in SoftBank Group’s Vision Fund over five years.

However, a source who is familiar with PIF’s strategy said it was not currently getting involved in any funding process for Tesla’s take-private deal. A second source close to the situation also said PIF was not taking part in any such plan at this stage. This source said that the Saudi fund would not make an investment of this kind without seeking guidance first from SoftBank. According to separate sources who spoke to Reuters last week, SoftBank is currently not pursuing an investment in Tesla given its investment earlier this year in rival GM Cruise. Pressure is mounting on Musk to produce details of his financing plan.
 

Bloomberg reported on Sunday that PIF is in talks that could see it become a significant investor in Tesla as part of the take-private plan but has made no firm decision, citing people with knowledge of the fund’s plans. Tesla’s board has not received a detailed financing plan from Musk and is seeking more information, sources told Reuters on Thursday.
 

The board will make a decision on whether to hire advisers and launch a formal review of Musk’s take-private proposal in the coming days, based on how much detail on the financing plan it receives from Musk, another source said. 

A spokesman for PIF was not immediately available for comment. A Tesla spokesman declined to comment on behalf of the company and Musk. 

The US Securities and Exchange Commission has contacted Tesla to ask about Musk’s assertion on Twitter that funding for his proposed deal was “secured”, the Wall Street Journal reported on Wednesday. Tesla is facing a make-or-break moment in its eight-years as a public firm, as competition from European automakers is poised to intensify with new electric vehicles from Mercedes, Audi, BMW and other rivals.
 

Taking Tesla private would remove the pressure from Musk coming from hedge funds betting that the company’s stock will drop given its production issues and negative cash flow. It would also remove the firm from the glare of Wall Street that comes with reporting quarterly earnings publicly. Musk has said he would be looking to keep his ownership of Tesla at around 20 per cent in a buyout deal.

Saudi fund pushed for 2 years to take Tesla private: Musk 
 

Saudi Arabia's sovereign wealth fund has been pushing to take electric carmaker Tesla private in talks with Chief Executive Elon Musk dating back nearly two years and also backed the deal last week, Musk said in a blog post on Monday. "Going back almost two years, the Saudi Arabian sovereign wealth fund has approached me multiple times about taking Tesla private," Musk wrote.