Fred Prouser / Reuters
- The Securities and Exchange Commission has issued formal subpoenas to Tesla, Fox Business reported Wednesday.
- Shares of Tesla sank by as much as 4% following the report.
- Follow Tesla's stock price in real-time here.
Shares of Tesla sank as much as 4% in trading Wednesday as the flurry of news surrounding Elon Musk’s plan to take his electric car maker private continued.
Fox Business reported Wednesday that the US' top equities regulator, the Securities and Exchange Commission, had issues subpoenas to Tesla regarding its privatization plans and Musk's "funding secured" tweet. Reporter Charles Gasparino said the investigation — which was first reported on by the Wall Street Journal last week and confirmed by Bloomberg — had reached "formal" stages.
Business Insider has not been able to confirm the Fox Business report. Both Tesla and the SEC declined to comment on the report.
Further weighing on the stock Wednesday was a confirmation from Goldman Sachs that it had been hired by Tesla to advise the company on a potential transaction to go private. That confirmation came two days after Musk first said he was working with the bank.
Securities lawyers have told Business Insider that Musk’s tweet, followed up with an explanation that funding was not actually secured at the time of the announcement, could leave Tesla and Musk liable to lawsuits from the SEC and shareholders.
Tesla initially skyrocketed to a new record high of $389.57 shortly after the announcement last week, but has since given up all of its gains and is now trading around $333 — 26% below the $420 price laid out by Musk.
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