‘Like giving away caviar to buy a $2 slice of pizza’: Tesla tumbles 4.2% amid fears Musk will offload stock to fund Twitter deal
Elon Musk’s proposed purchase of Twitter sent shares in Tesla tumbling amid fears the deal will distract him from his duties as chief executive of the electric car maker.
Tesla stock fell 4.2 per cent on Wall Street as investors became concerned Musk will offload more of his 14.8 per cent stake, currently worth around £98billion, to fund the deal.
Musk has already sold £13.4biliion of Tesla shares since agreeing to buy Twitter in April.
Tesla stock fell 4.2% on Wall Street as investors became concerned Musk will offload more of his 14.8% stake, currently worth around £98bn, to fund the deal
While the billionaire has said he does not plan to sell any more, some analysts think he will do so to provide extra funding for the deal.
Daniel Ives, analyst at broker Wedbush, told BBC Radio 4’s Today programme the saga had been ‘a disaster’ for the stock, adding: ‘He’s had to sell Tesla stock to buy Twitter. That’s like giving away caviar to buy a two-dollar slice of pizza.’
Tesla shares have fallen nearly 40 per cent since Musk revealed he had taken a 9.2 per cent stake in Twitter on April 4.
The decline in the share price has reduced the value of his stake by £60billion in that time, far more than he is paying for Twitter.
Matters have not been helped by the acrimonious legal battle that ensued when Musk tried to walk away from the takeover amid a row with the company over the number of fake accounts on its platform.
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