The Tesla CEO sold 4.4 million shares on April 26 and 27, according to regulatory filings.
Elon Musk sold nearly $4 billion worth of Tesla Inc. stock days after striking a $44 billion deal to buy Twitter Inc.
The Tesla CEO sold 4.4 million shares on April 26 and 27, according to regulatory filings. Musk has now shed more than $20 billion worth of shares in the electric carmaker over the past six months.
The world’s richest man struck a deal on April 25 to acquire Twitter in a financing scheme that has alarmed some Tesla investors. In addition to pledging tens of billions of dollars in his Tesla stock to back the margin loans, Musk has promised to raise some $21 billion in capital. It has been unclear how much of that would come from the sale of a portion of his Tesla stake.
Shares of Tesla rose 3% as of 4:30 a.m. Friday in New York, before the start of regular trading. The company has lost about $275 billion in market value since Musk first revealed that he had acquired a stake in Twitter earlier this month.
“It’s a brutal cycle for Tesla investors to navigate and it casts a shadow on the name,” said Dan Ives, a Wedbush analyst with the equivalent of a buy rating on the stock. “The Twitter deal is becoming a drag on Tesla stock.”
Musk, 50, tweeted after the filings were released Thursday that he “has no more Tesla sales planned after today.” It is not clear if he could have sold more than $4 billion. The tweet could imply that there were more disposals on Thursday that should be reported on Friday.
No further TSLA sales planned after today
— Elon Musk (@elonmusk) April 29, 2022
The Twitter deal is poised to be one of the largest leveraged buyouts in history, with Musk arranging $25.5 billion in debt and margin loan financing from lenders including Morgan Stanley. If it fell apart, the party that broke the deal would have to pay a $1 billion termination fee under certain circumstances.
Twitter shares closed Thursday at $49.11, lower than the $54.20 investors will receive for each share they own under the company’s deal with Musk.
Musk’s search on Twitter has once again highlighted the extent to which Tesla’s valuation depends on how involved and invested its CEO is in the business. He has run the company since 2008 and has long been its largest shareholder.
Tesla shares plunged late last year as Musk dumped more than $16 billion worth of shares, his first sales in more than five years. The sales began in November after Musk polled Twitter users on whether he should cut his stake.
With a fortune of $252.2 billion, Musk is the world’s richest person, according to the Bloomberg Billionaires Index. But the recent slide in Tesla shares has trimmed $18 billion from his net worth this year, even as the automaker reported better-than-expected earnings earlier this month.
(Updates to add context started in the seventh paragraph)
–With assistance from Tim Smith, Michael Sin, Michael J. Muñoz, Derek Wallbank, and Craig Trudell.