Musk sells another batch of Tesla shares despite vowing to stop

(Bloomberg) — Billionaire Elon Musk has dumped another batch of Tesla Inc stock. To help fund his purchase of Twitter Inc. Last year, he raised his sales of the electric car maker’s stock to about $36 billion.

Most Read From Bloomberg

Musk dumped 19.5 million shares worth $3.95 billion in the latest trading, according to regulatory filings late Tuesday in New York. The documents did not indicate that sales – his first since August – were planned in advance.

The filings come despite assurances from Tesla’s CEO and largest single shareholder that the stock has been emptied. Musk claimed in April that no further transactions were planned, and then again in August, saying it was important to avoid an “emergency sale” in case he needed to close his Twitter acquisition and struggled to bring in additional equity partners.

Tesla shares fell less than 1% at 9:36 a.m. Wednesday in New York. The stock is down 46% this year to Tuesday’s close, and has lost $600 billion in market value since it peaked last November.

READ MORE: Tesla halved in value in the year hit by Musk Stake sales

The world’s richest person followed suit with his takeover of the social media platform in October, after spending months trying to get out of it. It’s not entirely clear how the $44 billion deal was ultimately funded, well beyond the nearly $13 billion in debt obligations by Wall Street banks.

Several high-profile individuals have promised to invest about $7 billion, although it is not known if all of them have lived up to their pledges. Musk has never publicly stated how he planned to raise his share of the money needed to close the deal.

See also  Warren slams Jerome Powell for his interest rate comments: 'I'm very concerned the Fed is going to push this economy into a recession'

But one thing is clear: Twitter is losing money and now faces annual interest payments of nearly $1.2 billion. Since Musk took over, several major companies have paused their ads on the platform, waiting to see how they develop under the billionaire’s leadership.

“It looks like Musk is preparing for things to stay bad on Twitter for the year ahead,” Gene Munster of Loup Ventures said after the stock sales became public. “He’s preparing Twitter to be a money-hole.”

Musk, 51, and his financial assistant Jared Birshall, did not respond to an email request for comment.

The billionaire’s aggressive moves to cut costs — including firing half staff and later asking some to return — and overhauling the platform’s operations have led to a turbulent two weeks at the social media company, with some employees not entirely clear about whether or not they still work there. .

The deal also raised concerns among some Tesla shareholders that the CEO is spreading himself too thin and will have to divest more of his stock. He still owns about 14%, according to Bloomberg data.

Of the $36 billion in stock that Musk has sold, about half of that has come since it went public with a plan to buy Twitter, according to data compiled by Bloomberg. A drop in Tesla stock has brought Musk’s fortune down to $179.5 billion from $340 billion at its height, according to the Bloomberg Billionaires Index.

Assisted by Dana Hall, Ed Ludlow, Tom Maloney, Isha Day and Craig Trudel.

See also  Tesla shareholder meeting: Elon Musk teases products, warns of '12-month challenge'

(Stock trading updates in the fourth paragraph)

Bloomberg Businessweek’s Most Read

© Bloomberg LP 2022

Leave a Reply

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