Image Source: The Verge
Elon Musk, CEO of Tesla, sold an additional 7.92 million shares in the producer of electric vehicles, valued at approximately $6.88 billion.
Regulatory documents reveal the sales following the company’s annual shareholder meeting last week.
If compelled to pay $44 billion for Twitter, Mr. Musk claims he needs the money.
After declaring last month that he would cancel an agreement to purchase the social media network, the multi-billionaire is currently locked in a legal spat with it.
According to six documents submitted to the US Securities and Exchange Commission, the most recent transactions took place on August 5, 8, and 9.
Following the disclosure of the share sale, Mr. Musk replied to a tweet inquiring if he had completed selling Tesla shares with “yes,” adding that he needed the cash in case he was forced to acquire Twitter and was unable to secure some of the funds for the deal.
The need to sell Tesla stock in a hurry must be avoided, he stressed.
If the takeover of Twitter does not occur, Mr. Musk said “yes” when asked by another user if he would purchase Tesla shares once more.
Twitter sued Mr. Musk in July after he announced he would withdraw his offer to purchase the social media platform.
According to the richest man in the world, the corporation has been charged with hiding information about phony accounts.
Twitter’s lawsuit against Mr. Musk will go to trial in October; a US judge decided last month.
Twitter anticipates that the court will direct Mr. Musk to execute the acquisition at the agreed-upon price of $54.20 per share.
Though the specifics of that lawsuit haven’t been made public, Mr. Musk has counter-sued Twitter.
In addition, Twitter disclosed in July that it had spent $33 million on the potential transaction between April and June.
A net loss of $270 million was revealed, which was worse than predicted. However, it also stated that its monthly daily user count had increased to 237 million.
The remaining 25% of Tesla’s Bitcoin, which was valued at $2 billion at the end of 2021, was sold off last month, according to a statement from the company.
The business caused a stir when it disclosed a significant investment in the largest cryptocurrency in the world last year.
Tesla claimed that it spent $936 million from its Bitcoin sales on conventional currencies.
A series of documents submitted to the Securities and Exchange Commission late Tuesday night revealed the sales from Friday through Tuesday. Since he sold 9.6 million shares of Tesla in April, raising $8.5 billion at the time, these sales represent Musk’s first Tesla stock sales since then.
Soon after Musk and Twitter agreed to a $44 billion purchase agreement, the April transactions occurred. But he stated a month ago that he does not intend to follow through with that agreement, claiming that Twitter management withheld critical information about the number of user accounts that were spam and bot accounts rather than accounts managed by real people. So to compel Musk to proceed with the agreement on the terms struck in April, Twitter (TWTR) swiftly filed suit.
Sale of Tesla shares by Musk before now
The majority of the times that Musk has previously sold Tesla shares was to raise money for taxes on the exercising of options that were about to expire. The first large Tesla share sale by Musk that wasn’t motivated by an impending tax payment occurred in April, shortly after the Twitter deal was finalized.
Musk received an average price of $869 per share for the recent share sales. This is significantly less than his $1,046 average price when selling 15.7 million shares late last year. In April, his average price for his Tesla sales was $883 per share. When he exercised options that were about to expire, he was faced with a record personal income tax bill that needed to be paid. This transaction was made to cover the cost.
Musk still owns 155 million shares of Tesla, despite the most recent stock transactions, and he has the option to purchase another approximately 100 million at prices much below market value. About 20% of the existing shares of Tesla are under his control, thanks to the shares he owns and the options he has to purchase additional shares. Additionally, less than 3% of the shares and options he currently holds were part of the 7.9 million shares he recently sold.