Elon Musk aims to nearly double stake in Tesla
Elon Musk wants more control over Tesla—25% to be exact, which is nearly double his current holding.
This desire marks a reversal from two years ago when he sold 22 million Tesla shares to help finance his $US44 billion Twitter purchase, reducing his stake in the EV maker from 17% to approximately 13.7%.
The Twitter deal has turned into a disappointment, with the company, now known as X, experiencing a 71% drop in value, estimated at around $US12.5 billion based on Fidelity's latest valuation of its small stake.
On Tuesday, Morgan Stanley confirmed to Reuters that it had written down the value of its Twitter loans but didn't disclose the exact amount.
Why the change of heart?
"I am uncomfortable growing Tesla to be a leader in AI & robotics without having ~25% voting control," he stated on X on Monday.
"Enough to be influential, but not so much that I can't be overturned. Unless that is the case, I would prefer to build products outside of Tesla."
Under Musk's leadership, Tesla has ventured into new areas of technology. In July of last year, the company announced a $1 billion investment in Project Dojo, a supercomputer with machine learning capabilities. Additionally, Tesla unveiled Optimus, the humanoid created through Tesla's robotics division in 2022, which has yet to reappear in public.
A higher stake in Tesla (if he can acquire the shares) will result in a higher payout for Musk, who is already facing legal action over his CEO's package, which is 40,000 times the median Tesla employee's pay.
Perhaps the post on X (Twitter) was an attempt to stabilize a volatile share price—Tesla shares fell $US26 billion last week and have declined by more than 13.6% since the beginning of the year, representing a drop of over $US100 billion.
Much of Musk's shareholding in Tesla is pledged as security for loans related to his other businesses. According to a SEC filing from last April, 238.4 million of Musk's 411 million Tesla shares were pledged as security for personal loans.
If those figures haven't changed since last April, then Musk's total share value at Tuesday's closing price of $US219.91 was $US96.41 billion, and the pledged shares had a value of $US46.4 billion, posing a challenge for his bankers.
Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.