adplus-dvertising
Trends

Elon Musk Sells Tesla Shares Worth $6.9 Billion to Avoid Twitter Fire Sale

Elon Musk Sells Tesla Shares Worth $6.9 Billion to Avoid Twitter Fire Sale

Elon Musk sold $6.9 billion worth of Tesla Inc. stock, the billionaire’s largest ever transaction, claiming he wanted to prevent a last-minute stock selloff in case he had to move forward with his botched acquisition of Twitter Inc.

Several regulatory documents that surfaced after US markets were closed on Tuesday exposed that the CEO of Tesla sold around 7.92 million units on August 5.

elon musk sells tesla shares worth $6.9 billion to avoid twitter fire sale | technology news

Musk responded in a succession of late-night tweets because the rumours about the disposal spread, saying he wanted to prevent an emergency stock sale on the occasion that he is forced to present the $44 billion buyout of Twitter that he backed away from last month.

When asked by fans if he had stopped selling Tesla stock and would repurchase it if the deal fell through, Musk said, “Yes.” The transaction occurred just 4 months after Musk, the richest man in the world, declared that he had further plans to dispose of shares in the automaker he’s turned into a major player in the world, having already sold $8.5 billion worth of stock after withdrawing his first provide to acquire Twitter.

Since then, thanks to larger increases in US markets, Tesla’s shares have recovered from lows touched in May.

elon musk sells nearly $7 billion in tesla shares

According to Charu Chanana, an analyst at Saxo Capital Markets Pte in Singapore, “He definitely is emphasizing that he is cashing up for Twitter.”

“However, the sale’s timing, which was soon before the US CPI announcement, does point to something. The bear market rebound has begun to sputter, and further downgrading of Fed predictions could bring on additional losses for stocks, particularly in the tech sector.

Though they are still down by approximately 20% for the year, Tesla shares have increased by roughly 35% from their lows. Since Musk made his unexpected overture earlier this year, the market performance of Tesla has been correlated with that of the Twitter acquisition.

The billionaire said last month that he was cancelling the proposed deal to buy and take private the social media networks where he has more than 102 million followers, alleging Twitter had made “misleading claims” on the number of spam bots using the service.

elon musk sells $6.9 billion of tesla to avoid twitter fire sale | the japan times

Since then, Twitter has filed a lawsuit to compel Musk to complete the transaction. A Delaware Chancery Court trial has been scheduled for October.

Musk abandoned his intentions to use a margin loan that is safe and secured by his Tesla stock to partially finance the purchase in May and motivated the equity part to $33.5 billion.

He had earlier disclosed that he had received equity commitments totalling $7.1 billion from investors such as Sequoia Capital, Binance, and billionaire Larry Ellison.

Late on Tuesday, Musk stated in tweets that the stock sale was a backup plan in case those private investors didn’t materialize. The acquisition “should carry on original terms,” Musk wrote in a tweet over the weekend, “if Twitter provides its technique of sampling all of the accounts to ascertain the number of robots and how they are validated to be real.”

In the Twitter agreement, it was stated that, in certain situations, the party who violated the terms would be needed to pay a $1 billion termination fee.

musk sells tesla shares worth $6.9 billion, cites chance of forced twitter deal | m.news world

Legal experts have disagreed on whether the dispute over spam bots is very much sufficient for Musk to withdraw from the agreement.

Musk, 51, has now owned shares of Tesla valued at over $32 billion during the last ten months. After asking Twitter users if he should reduce his interest in the social media connections, the disposals began in November, starting the roller coaster that has surprised even the most experienced Musk observers. He is still by far the largest shareholder in Tesla, with a current ownership interest of 14.84%.

Before Musk’s tweets explaining the reasons for the sale, founding director of Loup Ventures Gene Munster stated that he believed the odds of the businessman acquiring Twitter were 75%.

Munster exclaimed, “I’m startled. In the near future, this will be a challenge for Tesla. Delivery and gross margin are all that count in the long run. Per Bloomberg News, Musk has the greatest fortune in the world with a $250.2 billion fortune; however, it is because the Tesla share prices have fallen this year, Musk’s worth has decreased by about $20 billion.

Following the shares’ recent recovery, the carmaker’s board of directors approved a three-for-one reverse split last week in an effort to draw even more retail investors.

elon musk is selling tesla stock for $6.9 billion if he loses twitter lawsuit - s chronicles

Along with the historic US climate change law that intends to increase the use of renewable power through a number of tax incentives, Tesla’s great second earnings have been positive.

Since Musk made his unexpected overture earlier this year, the market performance of Tesla has been correlated with that of the Twitter acquisition. The billionaire said last month that he was cancelling the provide to buy and take private the social media network in which he has over 102 million followers, alleging Twitter had made “misleading claims” on the number of spam bots using the service.

with tesla stock sale musk cashes up for twitter - breaking news, world news from ievren

Since then, Twitter has filed a lawsuit to compel Musk to complete the transaction. A Delaware Chancery Court trial has been scheduled for October. Musk abandoned his intentions to use a margin loan secured by his Tesla stock to partially finance the purchase in May and boosted the equity part to $33.5 billion.

He had earlier disclosed that he had received equity commitments totalling $7.1 billion from investors like Sequoia Capital, Binance, and billionaire Larry Ellison. Elon, 51, has now owned shares of Tesla valued at over $32 billion during the last ten months. The disposals began in November after Musk, a frequent Twitter user, asked the site’s audience whether he thought of reducing his ownership. The current sales’ motivation was not immediately apparent.

Although they are still down approximately 20% for the year, Tesla shares have increased by about 35% from recent lows hit in May.

Edited by Prakriti Arora

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button

Adblock Detected

Please consider supporting us by disabling your ad blocker