Why did Musk sell Tesla shares?
According to the SEC filing, that generated about $6.88 billion for Musk, who confirmed in a tweet this morning that the sell-off was to be better prepared for the possibility of a forced Twitter deal.
In the (hopefully unlikely) event that Twitter forces this deal to close and some equity partners don’t come through, it’s important to avoid an emergency sale of Tesla stock.
Shares of Tesla have recovered nearly 40% in less than two months. Now, therefore, was an opportunistic time to make such a move. If he successfully pulls out of the Twitter deal, Musk added, he’ll buy some of these shares back and launch his own social network, “X.com”.
Dan Ives reacts to the news
The billionaire also confirmed that he was unlikely to sell any more shares of Tesla. He had said the same about four months ago as well, though.
Twitter and Musk are now scheduled for a five-day trial over the $44 billion takeover deal in October. Earlier this week, he had tweeted this:
Reacting to the SEC filing, Wedbush Securities’ Dan Ives said:
This is the last thing Tesla investors wanted to see. The biggest fear has been that Musk sells more stock, and that’s what just happened. It’s a near-term gut punch. There’s no explanation and that adds to the uncertainty.
Interestingly, though, Tesla shares are in the green this morning. Wall Street currently has a consensus “overweight” rating on the stock.
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