Musk said Tesla would continue to be publicly traded, weeks after suggesting he would take the electric carmaker private.
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Tesla Inc. Chief Executive Elon Musk said late Friday he would heed shareholder concerns and no longer pursue a $72 billion deal to take the luxury electric car maker private, abandoning an idea that stunned investors and drew regulatory scrutiny. The decision to leave Tesla as a publicly listed company raises new questions about its future. Musk, who owns about a fifth of Tesla, said previously that he envisioned taking the company private without the standard method of a leveraged buyout, in which all the other shareholders would cash out and the deal would be funded primarily with new debt.However, Musk said Friday that a number of institutional shareholders explained they have internal compliance issues that limit how much they can invest in a private company.SHORT SELLERS EMBOLDENEDIn explaining his reasons to take Tesla private earlier this month, Musk cited pressure from short sellers – investors who look to profit on bets that a company's stock will decline.Musk has repeatedly said since April that Tesla has no need to raise new capital, and has promised that the company will be profitable and cash flow positive in the third and fourth quarters.
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