Nearly $7 billion in Tesla shares sold by Elon Musk

In a context of a legal tussle with an uncertain outcome with Twitter, Elon Musk sold Tesla shares for nearly $7 billion. According to a document filed with the SEC, the American stock market policeman, the multi-billionaire dumped about 7.9 million Tesla shares in three days.

Elon Musk has now sold nearly $15 billion worth of Tesla shares since April.

Elon Musk sold about 7.9 million shares (or nearly $6.9 billion) of Tesla between Aug. 5 and Aug. 9, 2022, as reported a document filed with the SEC, the American stock market policeman.

Read also : Tesla posts record profit of $3.3 billion

In the midst of a legal battle with Twitter, the multi-billionaire published a post on this same social network in which he explains that he wanted to “avoid an emergency sale of Tesla securities”, in the scenario, which he hopes is “improbable”, where he would be forced to buy Twitter and lose the support of some of its financial partners.

In April 2022, he had already sold some $8.5 billion worth of shares in the automotive group to prepare for the acquisition of the social network. At the time, Elon Musk had however assured that there would be no other sales of Tesla titles.

$15 billion in shares sold

With now more than 15 billion dollars in his pocket from these sales of stakes, the fiery entrepreneur, in the midst of a legal tussle over the broken promise of his takeover of Twitter, could prepare either to pay compensation, or ultimately finance the takeover, analysts said.

Musk may try to resolve this explosive situation before the trial date in October (…) with a massive out-of-court settlement“, suggested Dan Ivesof Wedbush Securities. The analyst indeed judged that the chances of an agreement with Twitter possibly involving a payment “ranging from 5 to 10 billion dollarswere “now more likely“.

A $44 billion deal

Tesla shares rose 2.50% to $871.25 around 4:00 p.m. GMT. That of Twitter climbed 3.56% to 44.35 dollars. Elon Musk signed a $44 billion deal in April to buy Twitter, before unilaterally breaking it off in early July. The boss of Tesla believes that Twitter lied about the proportion of automated accounts and spam on its platform, and even claims that the network “fraud”, by deliberately increasing the number of monetizable accounts.

Read also : Tesla resists in the second quarter of 2022

The multi-billionaire asked the CEO of Twitter, Parag Agrawal, to “publicly debate the percentage of fake accounts” and to “prove to the public that Twitter has less than 5% fake or unwanted daily users”. It was the point of disagreement put forward by the multi-billionaire to withdraw his offer to purchase, launching this legal battle.

As soon as the takeover agreement was broken, Twitter indeed sued the richest man on the planet, to force him to honor his promise. Elon Musk counterattacked, with a complaint in which he asks the court to release him from the agreement and order Twitter to pay him damages.

A trial on October 17, 2022

The trial is due to open on October 17 before the Delaware Court of Chancery, a court specializing in business law, and last five days. The chances that he will get out of it by paying only the indemnities for breaking the agreement (one billion dollars), or that he will be declared in his right, are considered very low by the experts.

Twitter shareholders must meet on September 13 to authorize or not this acquisition by Elon Musk, which would represent a substantial added value for shareholders. The Tesla boss initially pledged to offer $54.20 per Twitter share.

Twitter plummets as Tesla climbs

Between the general decline in the stock market in recent months, that of advertising revenue from social networks linked to the economic situation and public criticism from Elon Musk, the title of Twitter had collapsed to around 32 dollars on July 11.

The electric vehicle maker, for its part, posted strong second-quarter 2022 results at the end of July, with a profit of $2.3 billion, almost twice as much as the same period last year.

At the general meeting of shareholders on Thursday, which voted to split the group’s securities by three on August 25, 2022, to make the action more accessible to small holders, Elon Musk assured that the group was thinking of a buyback program of shares. The next day, he began to sell his own securities. “It doesn’t look very good for Musk“, commented Dan Ives. (With AFP)

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