Elon Musk Sold $4 Billion Worth Of Tesla Shares
Following the successful completion of his $44 billion takeover of Twitter, Elon Musk has reportedly sold an additional $3.95 billion value of shares in his electric vehicle manufacturer Tesla.
Musk reportedly sold 19.5 million more shares in Tesla, according to a number of sources and documents filed with the Securities and Exchange Commission that made it public on Tuesday.
Elon Musk Sells $4 Billion Worth Of Tesla Shares
The chief executive of Tesla, who is now the richest person in the world mostly because of his huge shares in the automaker, has sold over $19 billion worth of the electric vehicle manufacturer’s stock this year. Currently, Musk owns over 135 million shares of Tesla.
After deciding to offer $54.20 for every share of Twitter he did not already own in April, Musk finally completed the acquisition of the company late last month. Despite having co-investors positioned, Musk offered $33.5 billion in equity financing to fund the transaction, as disclosed. Larry Ellison, the creator of the Oracle software company, and the cryptocurrency exchange Binance provided $7 billion in backing for Musk. A group of banks provided a loan for the acquisition totaling $13 billion. As part of the acquisition, in which the firm became private, Twitter also took on $13 billion in debt.
Tesla took some time to answer when asked for a response. Since their peak in November of last year, the company’s shares have decreased by about 50%. Following the most recent stock sales, Musk now owns around 14% of Tesla.
What caused Musk to sell the company’s stock was unclear.
The Twitter conundrum: troubled waters ensue
Since Musk’s takeover of the social media giant, signs of stability and positivity began to fade. Early on under Musk’s leadership, Twitter’s advertising sector experienced upheaval.
According to the Journal, a number of major advertisers, including General Mills Inc. and Oreo manufacturer Mondelez International Inc., have suspended their expenditure on the platform while they watch how it develops under Musk. A number of Twitter’s top advertising execs with connections to purchasers were also let go by Musk.
With regard to advertiser worries that he would relax Twitter’s content control policies, Musk stated that the social media site “cannot become a free-for-all hellscape, where anything can be spoken with no consequences!”
Additionally, he announced that he would form a group of content moderators with a diverse set of viewpoints.
Expressive in his discontent, Musk has recently taken to Twitter to share his displeasure with the suspension of advertising.
According to several ad purchasers, these moves were taken out of concern that information about their marketing activities would be disclosed to Mr. Musk’s automaker. Other automakers that compete with Tesla have reduced their Twitter advertising. Since Elon Musk bought Twitter, a number of automakers have stopped running advertisements there, including General Motors, Ford, Volkswagen, and Stellantis NV.
All these developments must be read along with the fact that about 90% of Twitter’s income has come from advertising.
Further agitating the already troubled seas, Musk has been attempting to hastily rebuild Twitter and started commencing layoffs last week. In an effort to lessen the reliance of the business on digital advertising revenue, he is also pushing to raise the cost of a subscription plan called Twitter Blue from $4.99 to $7.99 a month.
However, the launch experienced a snag recently since most users were unable to get the expected software upgrade that would have allowed some subscribers to purchase blue check marks for their accounts.
Twitter may have to pay higher interest costs of more than $1 billion annually as a result of the debt it is taking on. Over the past five years, Twitter has recorded an average yearly earning before interest, taxes, depreciation, and amortization of around $700 million.
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