Elon Musk Offloads $4 Billion of Tesla Shares

Following a deal for $44 billion to acquire Twitter Inc., Elon Musk has sold approximately $4Billion worth of Tesla Inc. stock.

According to filings with regulatory agencies, Tesla’s chief executive officer sold off 4.4 Million shares in April 26 and 27, respectively. In the six-months since Musk’s departure, the Tesla chief executive officer has sold more than $20B worth of stock.

The world’s wealthiest man reached an agreement on April 25 to acquire Twitter using a financing plan that’s alarmed some Tesla investors. Musk also pledged tens and billions of dollars in Tesla shares as margin loans support, but he has promised $21 billion equity. It’s been unclear how much of that would come from selling a portion of his Tesla stake.

Tesla shares rose by 3% Friday morning in New York before normal trading. About $275 billion has been lost in market value since Musk disclosed that he took a stake early this month.

“It’s a brutal cycle for Tesla investors to navigate and casts a shadow on the name,” said Dan Ives, a Wedbush analyst with the equivalent of a buy rating on the shares. “The Twitter deal is becoming an albatross for Tesla’s stock.”

Musk, 50, tweeted after the filings were released Thursday that he has “no further Tesla sales planned after today.” It’s unclear whether he may have done more than $4 billion worth of selling. Tweet could indicate there were other disposals that occurred on Thursday and would need to reported by Friday.

This deal with Twitter is expected to become one of the largest leveraged buyouts ever. Musk has secured $25.5 million in margin-loan and debt financing from Morgan Stanley. Under certain conditions, the parties to the agreement that are breaking it down would have to pay $1 billion termination fees.

Musk’s pursuit of Twitter has once again highlighted the extent to which Tesla’s valuation hinges on how involved and invested its CEO is in the business. He’s headed the company since 2008 and has long been its largest shareholder.

Tesla’s stock slumped late last year as Musk offloaded more than $16 billion worth of shares, his first sales in more than five years. After Musk asked Twitter users whether they wanted to reduce their stake, the disposals began in November.

With a $252.2 billion fortune, Musk is the world’s richest person, according to the Bloomberg Billionaires Index. However, Musk’s net worth has fallen by $18 billion due to the slump in Tesla shares. This despite Tesla reporting better-than-expected earnings earlier in the month.

—With assistance from Tim Smith, Michael Sin, Michael J. Munoz, Derek Wallbank and Craig Trudell.

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