Elon Musk’s electric car maker company Tesla has lost 12.6 billion in the stock market.
The possibility of selling Mask’s shares in the company to raise money to buy Twitter has become a source of concern for the company’s investors. And the immediate result is that the price falls.
Although Tesla was not involved in the Twitter acquisition. The financial source of the deal has not been made public. Investors were worried about the company’s shares.
As Tesla’s share price plummeted 12.2 percent, Musk’s share price fell by 2.1 billion, the equivalent of the amount it paid in the Twitter deal.
Daniel Ives, an analyst at Wadebush Securities, a US-based investment firm, said he was concerned about Musk’s upcoming stock sale and was confused by Twitter’s “weight” of Tesla shares.
Tesla did not immediately respond to a request for comment.
Tesla’s stock has plunged in the ‘challenging’ situation of many technology companies in the stock market. On Tuesday, the US stock market Nasdaq ended its day at its lowest level since December 2020.
Investors are worried about a slowdown in global growth and an aggressive rise in share prices from the US Federal Reserve, Reuters reports.
Twitter shares also fell on Tuesday. The social media share price ended the day 3.9 percent lower at 49.6. Earlier on Monday, it was reported that Musk had expressed interest in buying the stock at 54.20 per share, including premium.
Most of Musk’s 23.9 billion assets are in the stock market. That’s why Reuters has asked the US tycoon to think twice about the Twitter deal.
“If Tesla’s share price continues to fall like this, it will put him in financial danger.” – says Ed Maya, a market analyst at Wanda, a foreign exchange company.
Musk borrowed 1.25 billion as part of the Tesla deal, which is tied to his Tesla stock.
Meanwhile, he has borrowed half of his shares in Tesla.
David Kirsch, a professor at the University of Maryland, thinks investors are worried about the “margin call” because of the debt. He researches on innovation and industrial enterprise.
