Elon Musk sells At Least $3.95 Billion Worth of Tesla Shares Following Twitter Takeover
Just days after completing his takeover of Twitter Inc., Tesla Inc. CEO Elon Musk dumped at least $3.95 billion worth of the electric car manufacturer’s shares.
On Tuesday in New York, Musk reportedly sold 19.5 million shares, marking his first stock sales since August. There was nothing in the papers to suggest that the deals were set in stone.
Even after spending months attempting to escape the social networking site, the wealthiest man in the world went through with his takeover in October.
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Musk indicated in August that he would no longer be selling Tesla shares, emphasising the need to prevent an “emergency sale” in the event that he was unable to consummate the Twitter purchase due to a lack of sufficient equity partners.
Beyond the about $13 billion in loan pledges from Wall Street banks, the final financing of the $44 billion transaction is unclear.
Some high-profile individuals have pledged a total of $7 billion; however, it is unclear how many of them will really make good on their commitments. Additionally, Musk has never revealed his strategy for raising his portion of the deal’s funding.
$1.2 Billion in Interest Per Year
Twitter is bleeding cash and must now pay roughly $1.2 billion in interest per year. After Musk took over, many big companies pulled their ads from the site because they wanted to see it grow in the way that the billionaire wanted.
After the news of the stock sales broke, Gene Munster of Loup Ventures commented, “It appears like Musk is prepared for things to continue terrible at Twitter for the next year.”
Also read: Elon Musk Visits the Twitter Office Before the Deal’s Closing Date
He expects Twitter to be financially draining and is making preparations accordingly. In response to an email asking for comment, neither Musk, 51, nor his chief financial officer, Jared Birchall, provided a response.
Employees at the social network firm have had a rocky two weeks due to the billionaire’s dramatic measures to reduce expenses, which included sacking half the workforce and subsequently asking others to come back and revamping the platform’s operations.
Some Tesla shareholders are worried that the acquisition would force Tesla’s CEO to sell off even more of his shares than he already plans to.
According to statistics provided by Bloomberg, he has sold almost $36 billion worth of shares in the automaker over the last year, with over half of that occurring after he made public his desire to acquire Twitter.
As a result, Musk’s net worth has dropped from $340 billion at its peak to $179.5 billion now, as measured by the Bloomberg Billionaires Index.