Musk sells Tesla shares for $ 5 billion

Status: 11.11.2021 12:25 p.m.

Tesla CEO Elon Musk has sold shares in his company worth around five billion dollars. He needs the money to pay taxes due and to use options to buy more Tesla shares.

After his sensational Twitter vote over the weekend, Tesla CEO Elon Musk cashed in his company’s shares for the first time in years. He sold more than 930,000 Tesla papers on Monday and took around $ 1.1 billion, according to a mandatory disclosure to the US Securities and Exchange Commission. On Tuesday and Wednesday he parted with a good 3.5 million other shares and collected around 3.9 billion dollars for it. Overall, Musk’s sales this week add up to roughly 4.5 million Tesla shares, valued at roughly five billion dollars.

Musk sells around three percent of its Tesla shares

At the weekend, Musk had Twitter users to vote on whether he should sell ten percent of his more than 170 million Tesla shares. 58 percent of the 3.5 million votes were in favor. The now completed sales correspond to about three percent of Musk’s Tesla share package.

However, the documents at the US stock market regulator show that the head of the electric car company wanted to sell at least part of the shares that have now been sold independently of the Twitter vote and had been preparing this for about two months.

Musk needs money to pay taxes

The background to this is Musk’s need for cash in order to pay taxes due. Elon Musk does not receive a traditional salary at Tesla, but is rewarded with stock options. Based on an agreement with Tesla from 2012, Musk now has options to purchase nearly 23 million shares in the company – at a price of less than $ 7 per share because most of the agreed prerequisites have been met by the company’s progress has met. Since the price of Tesla shares hit a record high of $ 1,243 just a few days ago, the difference results in enormous profits for Musk if he uses the stock options. At the beginning of the week, he also exercised the option to buy around 2.15 million new Tesla shares in parallel with the sale of the block of shares.

However, Musk then has to pay tax on the profit from the difference between the low purchase price and the current price. If the Tesla boss were to exercise all of his stock options, tax claims in the tens of billions would be the result. At the same time, time is of the essence as many of Musk’s stock options will expire in the coming months. It is therefore to be expected that he will have to sell more shares in order to be able to pay the taxes that become due by exercising his stock options.

Musk’s wealth is based on Tesla stock

According to the financial service Bloomberg, the multi-billionaire sold Tesla shares in the electric car manufacturer for the first time since 2016. The company’s papers have seen a massive stock market rally over the past few years. As a result, according to surveys such as the “Forbes” list or “Bloomberg Billionaires”, Musk has risen to become the richest person in the world with an estimated fortune of almost 300 billion dollars. Much of that wealth is based on the value of its stake in Tesla’s stock.

Musk makes announcement come true and sells stocks

Katharina Wilhelm, ARD Los Angeles, 11.11.2021 7:44 am

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