Elon Musk has sold $6.9bn (£5.7bn) worth of shares in Tesla after admitting he may need the funds if he loses a legal battle with Twitter and is forced to buy the social media platform media.
Tesla’s CEO pulled out of a $44 billion deal to buy Twitter in July, but the company launched a lawsuit demanding he complete the deal. The trial will take place in Delaware in October.
“In the (hopefully unlikely) event that Twitter forces this deal to close *and* some equity partners do not materialize, it is important to avoid an emergency sale of Tesla stock,” Musk said in a tweet late Tuesday.
In other comments on Twitter on Tuesday, Musk said yes when asked if he was done selling Tesla stock. He also said he would buy back Tesla stock if the Twitter deal doesn’t close.
Musk has committed more than $30 billion of his own money to finance the deal, with more than $7 billion of that amount provided by a group of backers including tech mogul Larry Ellison, Qatar’s sovereign wealth fund and the largest cryptocurrency exchange in the world, Binance.
Musk, the world’s richest man, sold $8.5 billion worth of Tesla stock in April and said at the time that no further sales were planned. But legal experts have since suggested that if Musk is forced to complete the acquisition or settle the dispute with a stiff penalty, he is likely to sell more Tesla stock.
Last week, Musk launched a countersuit against Twitter, accusing the platform of intentionally underreporting the number of spam accounts on the platform. Twitter has consistently stated that the number of spam accounts on its service is less than 5% of its user base, which currently stands at just under 238 million. Legal experts said it would be difficult for Musk to convince a judge that Twitter’s spam problem represented a “material adverse effect on the company” that significantly altered the company’s value — and therefore void the deal.
Musk sold about 7.92 million Tesla shares between Aug. 5 and Aug. 9, according to multiple filings. He now owns 155 million Tesla shares, or just under 15% of the electric car maker.
The latest sales bring Musk’s total Tesla stock sales to about $32 billion in less than a year. Still, Musk remains comfortably ahead of Jeff Bezos as the world’s richest person, with a fortune estimated at $250 billion, according to the Bloomberg Billionaires Index.
Tesla shares have risen nearly 15% since the automaker reported better-than-expected earnings on July 20, also helped by the Biden administration’s climate bill, which, if passed, would remove the cap on tax credits for electric vehicles funds.
Musk also teased Tuesday that he might start his own social media platform. Asked by a Twitter user if he had considered starting his own platform if the deal didn’t go through, he replied: “X.com.”
With Reuters
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