Where’s the Money Coming From, Elon?

Not long ago, a brash entrepreneur whose once-beloved consumer brand had fallen on hard times announced a plan to take his company private. Completing the transaction—the purchase of Dell Inc. for $25 billion by Michael Dell and Silver Lake Management LLC—required countless meetings with special committees, activist shareholders, investment banks, management consultants, and at least four law firms. There were competing offers to consider, and a lawsuit from Carl Icahn to contend with. It took Dell six months just to announce the deal and another nine to close it in 2013.

On Aug. 7, Elon Musk, the chief executive officer of Tesla Inc., appeared to pull off the same trick with a single tweet: “Am considering taking Tesla private at $420. Funding Secured.” A buyout of Tesla at that price—almost 25 percent above where the stock was trading—would make the deal worth $82 billion. That’s more, after adjusting for inflation, than the record-setting buyout of RJR Nabisco that closed in 1989.