Because of dispute with Twitter
Musk is selling more Tesla shares than ever
Star entrepreneur Elon Musk has sold Tesla papers worth 6.9 billion US dollars – around 6.8 billion euros. photo
© Susan Walsh/AP/dpa
Elon Musk is again selling Tesla shares for several billion dollars. The tech billionaire explains that he wants to avoid a possible emergency sale if he still has to complete the purchase of Twitter.
Contrary to previous promises, Tesla boss Elon Musk has again sold shares in the US electric car manufacturer on a large scale – and refers to the dispute over the Twitter takeover. Musk sold $6.9 billion worth of securities, according to reports to the US Securities and Exchange Commission on Tuesday.
“In the (hopefully unlikely) event that Twitter forces the deal to close and some equity partners exit, it’s important to avoid a fire sale of Tesla shares,” Musk said in a tweet. At the end of April he had written that no further share sales were planned.
Musk is in a legal battle with Twitter because he wants to call off the roughly $44 billion takeover of the short message service. Musk justified his withdrawal by saying that Twitter had given false information about the number of fake accounts on the platform. The service also breached its contract by not providing sufficient access to check the numbers, its lawyers argue. Twitter rejects the allegations and wants to reach a court in Delaware that Musk is obliged to close the deal on the original terms. The five-day hearing is scheduled to begin on October 17.
In April, Musk sold Tesla shares in multiple stages for around $8.5 billion to fund the Twitter deal. He had originally planned to finance part of the purchase price with a loan secured with Tesla shares. But the slide in the share price of the electric car manufacturer thwarted his plans. Instead, he announced that he would contribute a higher proportion of the purchase price as equity and brought partners such as software entrepreneur Larry Ellison on board.
Tesla share buyback signaled
This week’s sale was the largest single move in which he dumped Tesla stock to date. Last year he had already raised more than $ 16 billion from the sale of shares in the electric car manufacturer. For one thing, he had to do this to pay taxes on redeemed stock options. At the same time, in a Twitter survey of users of the service, he had committed himself to selling off a tenth of his holding.
Musk has also now signaled that he could buy back Tesla stock if the Twitter acquisition doesn’t go through. When asked by followers on Twitter if he would stop selling and buying Tesla stock in that case, he succinctly replied, “Yes.”
When Musk started his big stock sales last year, some Tesla shares were worth more than $1,100. They closed at $850 on Tuesday – after the price fell just below $630 in May.