Tesla’s board named a special committee of three directors on Tuesday to negotiate with Elon Musk on taking the electric carmaker private, although it said it was yet to see a firm offer from the company’s chief executive.
Musk said on Monday he had held talks with a Saudi sovereign fund on a buyout that would take Tesla off the Nasdaq exchange — an extraordinary move for what is now the United States’ most valuable automaker, worth more than $60 billion.
The committee, made up of Tesla independent directors Brad Buss, Robyn Denholm and Linda Johnson Rice, will wade into a deal that has puzzled Wall Street since a surprise announcement by Musk on Twitter last week.
Musk then proposed taking the company private at $420 a share – versus the current $354 – and said funding had been “secured”.
He has given more details – including saying he is working with Goldman Sachs and buyout firm Silver Lake – but is yet to convince Wall Street analysts and investors that he can find the billions needed to complete the deal.
Corporate governance and shareholder voting advisor Institutional Shareholder Services has said it does not consider Buss to be an independent director, running counter to Tesla’s view, due to his connections to a solar panel business the company bought two years ago.
Buss was chief financial officer of solar panel installer SolarCity for two years before retiring when Tesla paid $2.6 billion for the sales and installation firm in 2016.
The purchase was Tesla’s last big deal and was criticized by some on Wall Street because the company, founded by two of Musk’s cousins, had seen its business shrink before the takeover.
Denholm, the first woman to join Tesla’s board, is chief operations officer of telecom firm Telstra and the ex-CFO of network gear maker Juniper Networks. Rice, the first African-American and second woman to join the company’s board, is the chairman of Johnson Publishing Co, home to Ebony and Jet magazines.
Tesla’s other board members include Musk, his brother Kimbal Musk, Twenty-First Century Fox’s CEO James Murdoch, Antonio Gracias, founder of Valor Equity Partners and Ira Ehrenpreis, founder of venture capital firm DBL Partners.
One more director, Steve Jurvetson, is currently on leave of absence following allegations of sexual harassment.
Tesla’s board disclosed on 8 Aug. that Musk had held talks with the directors in the previous week on taking the company private.
The company said in the statement that the special committee has the authority to take any action on behalf of the board to evaluate and negotiate a potential transaction and alternatives to any transaction proposed by Musk.
Latham and Watkins LLP has been retained by the committee as its legal counsel. Wilson Sonsini Goodrich and Rosati will be legal counsel for Tesla itself.
Shares in Tesla inched down 0.2 percent in early trading and have now fallen more than 8 percent from highs hit following Musk’s tweet last week.