Elon Musk purchased Twitter on April 25, 2022, for roughly $44 billion, but not without some blowback. As it appears, the infamous Tesla mogul forgot to account for the effects his ambitions might have on the share price of Tesla, which dropped from a high of roughly $999 billion on the morning of April 25, to a low of $876 billion in the late afternoon of that same day, according to the NYSE as quoted by Google Finance.
According to the BBC, it’s likely that Tesla shareholders sold a high number of shares in a flurry, due to growing concerns that Musk would be leveraging Tesla stock to foot the bill for his Twitter purchase. In the case that Musk sold a significant number of his own shares, the overall value of the stock would plummet, and investors seem to agree that there was a considerable risk of him doing so — triggering a pre-emptive selloff of their own. Since April 25, the Tesla stock has begun to regain value, but it’s still unclear how Musk plans to manage his finances with regard to the recent Twitter purchase.
When Elon Musk’s bid to purchase Twitter first became publicized, he pledged to use $21 billion of his own money to make the purchase, but it’s not entirely clear how much of that cash was implied to be coming from Tesla stock sales. The New York Times noted that Musk holds 17% of Tesla’s shares, equating to about 175 million shares in all.