Tesla stock has reversed its slump after Elon Musk said he is finished selling stock in the electric vehicle firm he runs as CEO in order to fund his pending $44 billion acquisition of Twitter.
About $8.5 billion in stock sales, done in multiple transactions spanning 9.4 million shares, have been disclosed over the past couple of days in regulatory filings. Late on Thursday, Musk tweeted that “no further TSLA sales planned after today.” That news appears to have come as a relief to Tesla investors. The high-flying stock had pulled back more than 20% on the news of Musk’s $44 billion acquisition of Twitter. The deal was formally announced on Monday, less than two weeks after Musk acquired a 9% stake in the social media company.
Musk is the world’s richest person but his wealth is not very liquid. He owns sizable positions in several companies, notably Tesla. The high-wire act he has to pull off is tapping his vast reserves of valuable Tesla stock without creating a panic among its investor base that he is distancing himself from the firm. (Already, Musk divides his time among SpaceX, Tesla and the Boring Company.)
Although he isn’t a founder of Tesla, Musk has attained a massive following by steering the company’s unlikely emergence as the leading maker of electric vehicles. That recent success followed Musk’s earlier breakthrough as a co-founder of PayPal, which established him among the tech sector’s elite.
Musk has declared his intention to bring about significant changes to Twitter, most notably rolling back its content moderation efforts. He often relays critiques of the social media company to his 88.7 million Twitter followers.
After the announcement of the proposed privatization of Twitter, the parties announced that if either one were to walk away from the transaction, they would owe a $1 billion breakup fee. Many Musk-watchers and Wall Street analysts have noted that if Tesla stock were to go into any prolonged slump, Musk may be tempted to pay the fee and end his pursuit. As of now, that scenario doesn’t seem to be likely, but the stock markets in 2022 have been exceedingly volatile and the tech sector in particular has had a discouraging start to the year.
Must Read Stories
Subscribe to Deadline Breaking News Alerts and keep your inbox happy.