Twitter’s new owner Elon Musk has unloaded another 22 million shares of his publicly-traded electric automaker Tesla, raising north of $3.5 billion.
The move follows a sale in November of 19.5 million shares of Tesla and that company’s stockholders are growing increasingly restless and vocal about the founder and CEO’s commitment and highly public distractions with his latest venture. In April, when Musk also divested a big chunk of Tesla ahead of his $44-billion Twitter takeover, he promised there would be no more selling of Tesla stock but sold another tranche in November.
Musk divested his latest batch of shares on Monday, Tuesday and Wednesday this week, according to tan SEC filing. They were sold in multiple transactions at an average price per transaction ranging from about $156 to over $176 per share.
No reason was given. But Twitter has high debt and corresponding high interest payments and by Musk’s own admission is suffering a sharp downturn in revenue and burning through cash. He has been slashing costs amid mass layoffs. This week he Tweeted: “At risk of stating obvious, beware of debt in turbulent macroeconomic conditions, especially when Fed keeps raising rates.” The Federal reserve increased interest rates by 0.5% yesterday — the seventh rate hike since March.
Telsa shares are down nearly 60% year to date. They are up a hair in early trading today.
“The Twitter nightmare continues as Musk uses Tesla as his own ATM machine to keep funding the red ink at Twitter which gets worse by the day as more advertisers flee the platform with controversy increasing driven by Musk,” said analyst Dan Ives at Wedbush Securities.
“When does it end? This remains the worry on the Tesla story as Musk has managed to change the narrative of Tesla from the fundamental EV transformation story to a “source of funds” funding the Twitter turnaround which we believe will go down as the most overpaid tech acquisition in the history of M&A and remains a train wreck situation,” he said.
Musk reluctantly paid out for Twitter in October after trying hard to get out of the deal and took the social media company private. Confusion over its moderation policies or lack thereof have seen some advertisers exit, further squeezing financials. Musk’s own regular and often controversial tweets, including against Twitter’s former staffers and in leaks of company emails, have fanned the sensation of a company in chaos.
The sales have resulted in Musk personally moving to the second spot behind LVMH CEO Bernard Arnault in the list of the world’s richest individuals as his net worth plummeted.