Tesla CEO Elon Musk recently sold a large number of Tesla shares, drawing keen attention to the use of “emergency money.” Bloomberg reported that CEO Musk’s stock disposition was related to the financial problems of Twitter, which he recently acquired.
Musk announced on the previous day that he sold $3.58 billion worth of Tesla shares. According to the U.S. Securities and Exchange Commission (SEC), Musk sold 22 million Tesla shares for three days from the 12th. Bloomberg analyzed, “Musk is persistently selling stocks even after repeatedly affirming that Tesla’s stock disposal is over,” adding, “This reflects the growing financial pressure on Twitter.”
Musk posted on Twitter in late April that he had no plans to sell additional Tesla shares, and in August, he declared that the sale of shares to raise funds for the acquisition was over after abruptly breaking the Twitter acquisition contract. However, when Musk took over Twitter after a legal battle, he sold Tesla shares to raise $15.4 billion in cash, and sold an additional $3.95 billion worth of Tesla shares in early November, just days after signing the acquisition contract.
Bloomberg pointed out that “Musk’s volatile and impulsive approach to SNS management has led to the departure of advertisers.” He then tried to expand sales by introducing “Twitter Blue,” a paid authentication service that confirms that the user account is real, but it was diagnosed that it had an adverse effect as only controversy arose.
In addition, Musk took on a considerable amount of high-interest loans on Twitter by using the LBO method when acquiring Twitter. Twitter debt has more than tripled from $1.7 billion to $13 billion, with an additional amount of interest to be paid per year approaching $1.2 billion, Bloomberg said.
“It’s not a good situation,” said Tony Sycamore, an analyst at investment information company IG Market. “I talked to many investors who have Tesla shares, and they were completely angry with Musk.”