Tesla has fallen after selling a 10% stake in Musk after a Twitter poll Automotive News

Tesla Inc. rejected a poll conducted by the head of electric cars after Elon Musk’s Twitter followers voted in favor of selling 10% of its shares.

A majority of the 3.5 million Twitter users (58%) said they would accept the sale in a Twitter poll Musk conducted over the weekend. The stake would be valued at about $ 21 billion, based on its 170.5 million Tesla shares.

“I was willing to accept both results,” Musk said in a tweet after closing the survey.

Shares of Tesla fell 4.1% in pre-market trading on Monday compared to a close of $ 1,222.09 in New York on Friday, after a 7.5% drop earlier.

The crowd-sourcing exercise is the latest example of Musk’s long history and is the latest example of the long history that the platform uses his group of fans to spark interest in his company. The richest person in the world proposed the move in a tweet, citing recent discussions about raising unearned profits to avoid paying taxes. Musk doesn’t take a salary, but he has to pay taxes on the stock options he takes advantage of.

Musk’s tweets have moved Tesla’s shares in the past, sometimes angering authorities. Musk agreed to receive the approval of a Tesla attorney in 2018 before disclosing the material to investors as part of an agreement with U.S. securities regulators. It was unclear whether the official predicted Musk’s Twitter poll.

Signal Intentions

While large domestic sales are seen as a negative sign, sales of this size will not change Tesla’s story significantly, said Securities analyst Dan Ives Wedbush. Tesla remains in high demand for shares among institutional and retail investors, he said. An unorthodox step towards getting fans and investors to buy through the survey can alleviate concerns.

“Selling 10% is likely to add 1.5% to 2% to the float, so it doesn’t move the needle significantly,” Ives said in a phone interview. “I think doing so would soften the blow and also help perception.”

Shares of the automaker have risen 73% this year from November 5 to $ 1,222.09, and are valued at $ 1.2 trillion. The number of shares that Musk – its CEO and largest shareholder – can download from Tesla is equivalent to 80% of the average trading volume over the past three months. The number of shares he could potentially sell would be even higher if his options were included.

Tesla shares will not officially begin trading again until Monday morning in the US

Personal fortune

Musk’s money is $ 338 billion, according to the Bloomberg Billionaires Index. A quarter of that is made up of Tesla stock options that can be used at any time. The values ​​come from the two major awards he received in 2012 and 2018. Older contracts will expire in August next year.

I was willing to accept both results

– Lorde Edge (@elonmusk) November 7, 2021

If they took every opportunity now and sold the shares immediately, they would get $ 95.9 billion before taxes.

It is possible that Musk wants liquidity beyond the money he secures against his shares in the EV producer. He suggested that he would sell some shares last week if the UN could prove that it would help alleviate world hunger by $ 6 billion. For years, Musk said he would be the last to sell the shares, and has often added his position so that Tesla does not dilute his stake when he raises money from Wall Street.

Tax Status

Musk moved to Texas in late 2020, which has no state income tax. But as Tesla’s market value has risen and his personal wealth has risen, Musk has become a symbol of rising inequality, seemingly sensitive. He was among the millionaires mentioned in a Pro Publica study on how ultra-rich people avoid paying taxes, and has become a target for members of Congress who are pushing for a millionaire tax.

“Whether or not the richest people in the world should pay taxes should depend on the results of a Twitter poll,” U.S. Sen. Ron Wyden, an Oregon Democrat, wrote in a tweet Saturday. “It’s time for the Billionaire Income Tax.”

In response to Wyden’s message on Sunday, Musk appears to have used raw language to describe a photo of Wyden’s profile.

On his way to becoming the richest person in the world, Musk has made millions — and even at least a million — among his fans, employees, and other investors. Among them is Leo KoGuan, a Singapore-based retail investor and business owner who already used his vast wealth to raise more than $ 7 billion in Tesla shares.

Tell KoGuan that among these Twitter followers it is time for Musk to make money for the automaker, even if Musk uses space and neural networks to use it in other actions. “Politically and from a tax point of view and seeing that Elon is poor in money, he has not sold his other options to pay taxes and be rich in money,” KoGuan posted on November 6th.

(Updates trade in paragraph four and adds Musk’s response to Senator Wyden in paragraph 16)

–With the help of Anders Melin and Nick Baker.