Musk`s latest disclosure comes six days after he surprised investors by announcing on Twitter that he was considering taking Tesla private at a price of $420 per share and that funding was "secured."
Since then, no investors have stepped forward publicly as being involved with the plan, and Musk`s tweet is under investigation by the U.S. Securities and Exchange Commission, according to the Wall Street Journal, and the subject of lawsuits brought against him by investors.
Tesla shares were down 0.3 percent after opening sharply higher. The company declined to comment beyond the blog post.
Musk on Monday said he is talking to other potential investors but did not provide any details on the exact source of financing. He also said he is still trying to gauge how many existing shareholders would keep their stake in a new private company, which would determine how much funding is needed.
"I left the July 31st meeting (with the Saudi fund) 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," Musk said.
"This is why I referred to `funding secured` in the August 7th announcement."
The Saudi fund over nearly two years had approached him repeatedly about taking the company private, Musk said, and the latest meeting came after it took a nearly 5 percent stake in Tesla.
Saudi Arabia`s Public Investment Fund (PIF) manages more than $230 billion in assets, but about 65 percent of that is stakes in large Saudi companies and most of the rest has been committed in overseas deals such as funding commitments to Blackstone Group`s
The Saudi fund intends to sell its $70 billion stake in Saudi Basic Industries to oil giant Aramco, which could free up funds for new deals, but that sale may take months to conclude.
Yasir Othman al-Rumayyan, managing director of the PIF, referred Reuters to the corporate communications team, which did not immediately respond to a request for comment. FUNDING QUANDARY
Musk said that since his Twitter post on the possibility of a deal the managing director of the Saudi fund had expressed support for proceeding subject to financial and other due diligence.
PIF officials have said in the past that decisions at the sovereign wealth fund are made with care, emphasizing corporate governance. The PIF board is headed by the Crown Prince Mohammed bin Salman.
Meanwhile, Musk faces scrutiny of his tweet on secured funding.
Securities lawyers said U.S. law requires executives and companies to have a “reasonable basis” on which to make statements, meaning the fact Musk said he believed he had secured a verbal agreement for the funding after the July 31 meeting could put him on a firmer footing with the SEC.
It remains unclear if his definition of "secured" matches those of a reasonable shareholder, who may believe the statement indicated Musk had a written agreement, they said.
“This supports the idea that there was reasonable basis on which to believe that funding could be secured but it doesn’t eliminate the concern with respect to whether ‘secured’ was an overstatement and only underscores how inappropriate Twitter was for such a disclosure,” said Zachary Fallon, a former SEC attorney and principal at law firm Blakemore Fallon.
Wall Street had voiced doubts about Musk`s ability to pull off what could be the largest-ever go-private transaction, valued at as much as $72 billion.
Musk on Monday estimated two-thirds of existing Tesla shareholders would roll over their holdings into a private company, but said that he was still talking with major shareholders and advisers before settling on a structure for the deal.
Musk added that most capital for the deal would come from equity and it would not be "wise" to burden the company with added debt. Discussing full details on the plan, including the source and nature of the funding, would be "premature" now, he said.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)