It’s not easy to get government approval for technology deals with international acquirers. Just ask Broadcom and Qualcomm. Reviews by the Committee on Foreign Investment in the United States can doom deals, and it’s likely Tesla will need approval from national security officials, as Bloomberg reported Wednesday, to get a deal done.
The Foreign Investment Risk Review Modernization Act (FIRRMA) will make advisors’ jobs even more challenging, said Rosener. The CFIUS reform act was recently signed into law by President Donald Trump and further complicates which transactions will be subject to approval.
Despite all of these variables (and likely several more), a seasoned advisory firm can probably put together a structure that will be considered by the board, especially if Musk can tap billions from Saudi Arabia’s sovereign wealth fund. Bernstein analyst Toni Sacconaghi Jr. said in a note to clients Thursday that he placed odds of a take-private at less than 50 percent.
Still, at those odds, to quote Jim Carrey in the movie “Dumb and Dumber,” “you’re telling me there’s a chance.” And with all of the concerns surrounding Musk and corporate governance, getting out of the public markets — even with all of the above questions — might not be such a bad thing anymore.
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