"Am considering taking Tesla private at $420. Funding secured," Musk tweeted at 12:48 p.m. EDT (1648 GMT).
Tesla options volume jumped to 384,000 contracts, with options changing hands at about twice the usual pace, according to options analytics firm Trade Alert.
Call options, which convey the right to buy shares at a fixed price in the future, were particularly busy, and logged significant price gains on the day.
One block of 714 Tesla call options, betting on the shares rising above $365 by the end of the week, were bought for 85 cents, for a total outlay of $60,690 at 12:21 p.m. EDT.
On paper, the value of these calls jumped to $790,398, by 1:11 p.m. EDT. Other near dated bullish contracts also registered sharp gains.
The contracts were bought minutes after the Financial Times, citing unnamed people with direct knowledge of the matter, reported that Saudi Arabia`s sovereign wealth fund, overseen by Crown Prince Mohammed bin Salman, has built a significant stake in Tesla.
Tesla shares were halted on Tuesday afternoon for pending news. They were last up 7.4 percent at $367.25. The shares have climbed about 22 percent this month, on pace for their best monthly performance since February 2014.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)