Just yesterday, you might have thought that Tesla CEO Elon Musk would limit himself to selling $4 billion of the company’s shares to partially fund the upcoming acquisition of Twitter’s assets. In reality, by the end of the week, this amount increased to $8.5 billion; and formally after that, the billionaire made a statement that he would no longer sell shares.
The fact is, as the Barron’s resource explains, Musk sold the first block of shares on April 26, but continued to sell shares on April 27 and 28. He made his statement about the termination of the sale of Tesla shares on the 28th, but the corresponding reports on past transactions were received by the SEC with some delay, so in reality the amount of proceeds from the sale of shares of the funds turned out to be higher than the original $ 4 billion. In fact, by Thursday Elon Musk managed to sell 9.6 million Tesla shares he owned for a total of about $ 8.5 billion. This reduced the share of the head of the company in Tesla’s capital by 5.6%.
Elon Musk sold $8.5 billion worth of Tesla shares to pay for Twitter purchase
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Recall that from his own funds, Musk will have to cover a share of $ 21 billion; to buy Twitter assets on previously announced terms. Through the sale of shares, he provided $ 8.5 billion of this amount; the rest will have to be financed from other sources. Elon Musk has 163 million Tesla shares in his hands; and he will receive about 100 million more if the options are exercised. The remaining $12.5 billion of funds required to buy Twitter, Musk may raise at the expense of one of the partners, according to Reuters, but so far they are difficult to find. Another $13 billion in loans will be secured by Twitter guarantees; and $12.5 billion beyond that will be secured by Musk against part of his remaining Tesla shares. All assets of Twitter are estimated by the billionaire at $44 billion.
The head of Tesla and SpaceX managed to raise approximately $46.5 billion to finance the purchase of Twitter; which is 18% more than the amount needed to buy out the 90.8% of the company’s shares; that remained out of Musk’s control. Third-party investors lent him $25.5 billion of this amount; and he managed to get $12.5 billion on the security of his Tesla shares. Musk will also have to pay Twitter shareholders a $1 billion penalty if the deal doesn’t go through. However, if it is not completed due to the fault of Twitter, then Elon Musk will receive similar compensation.