Tesla boss Elon Musk has sold $6.9 billion ($9.8 billion) worth of shares in the electric vehicle maker, saying the funds could be used to fund a possible deal on Twitter. he was losing a legal battle with the social media platform.
- Mr Musk sells Tesla shares as he puts his finances in order ahead of legal battle with Twitter
- The social media platform is suing the billionaire over his efforts to walk away from an April deal to buy the company
- Tesla boss files countersuit, alleging Twitter misled him about key aspects of his business
“In the (hopefully unlikely) event that Twitter forces this deal *and* certain financial partners don’t materialize, it’s important to avoid a fire sale of Tesla stock,” he said. he said in a tweet on Tuesday evening.
Shares of the microblogging site rose 3.5% to $44.35 pre-market, but were still trading significantly below Mr. Musk’s offer price of $54.20 per share.
Tesla shares rose 1.6% to $863.1.
In early July, Mr. Musk tore up his April 25 deal to buy Twitter for $44 billion.
Twitter sued Mr Musk to force him to close the deal, dismissing his claim that he was misled about the number of spam accounts on the social media platform as buyer’s remorse, to following a fall in tech stocks.
Both sides will go to trial on October 17.
Following the stock sale announcement on Tuesday, Mr Musk took to Twitter and said “yes” when asked if he was done selling Tesla shares, adding that he would would repurchase if the Twitter deal didn’t go through.
“The removal of the ‘fire sale’ risk, the fact that Musk has already raised funds in the event of a Twitter move against him, and the comment that he will buy back shares if the Twitter deal is dropped all create a positive bias for Tesla. “said Mark Taylor, sales trader at Mirabaud Securities.
Tesla did not immediately respond to a request for comment.
The stock sale comes shortly after Mr Musk told the company’s annual general meeting that Tesla was a “buying opportunity”.
“Elon’s sale of (Tesla shares) over the past three days significantly increases the odds of the (Twitter) deal going through, albeit at a slightly lower price of $50-51/share,” Gary said. Black, managing partner of Future Fund LLC, in a statement. Tweeter.
Mr Musk, the world’s richest person, sold $8.5 billion worth of Tesla shares in April and said at the time that no further sales were planned. But since then, legal experts had suggested that if Mr Musk was forced to complete the acquisition or settle the dispute with a hefty fine, he was likely to sell more Tesla shares.
Mr Musk sold around 7.92 million shares between August 5 and 9 and now owns just under 15% of the company, according to Reuters calculations.
The latest sales bring Mr. Musk’s total Tesla stock sales to around $32 billion in less than a year.
Tesla shares have risen nearly 15% since the company reported better-than-expected earnings on July 20, also helped by the Biden administration’s climate bill which, if passed, would lift the ceiling for tax credits for electric vehicles.
Mr Musk also teased on Tuesday that he might launch his own social media platform.
When a Twitter user asked him if he had thought about creating his own platform if the deal didn’t close, he replied: “X.com”