In Brief:
- Based on regulatory filings, Elon Musk has sold about $5 billion worth Tesla stock.
- This step is taken to satisfy tax obligations related to exercising stock options.
Elon Musk sold roughly $5 billion worth of Tesla stock this week. It was the first such sale since 2016 just days after conducting a Twitter poll asking his followers if he should dispose of 10% of his stake in the electric carmaker.
Elon conducted the poll over the weekend. About 58% voted in favor to sell the stock of Tesla. According to analysts, the CEO owns about 23% of Tesla stock and has about $10 billion in taxes coming due on stock options that vest next summer.
As per filings with US securities regulators, Musk had sold 934,091 shares raising about $1.1 billion out of more than 2.1 million options he received as part of a compensation package. According to the regulatory filing, Musk sold some of his stakes to fulfill tax obligations related to exercising stock options, as mentioned by Bloomberg.
He has more than 20 million further stock options that will expire in August 2022.
The 4.5 million shares equal about 3% of his total holdings in Tesla, which is the major part of his estimated $281.6 billion worth fortune. Musk also said in a statement that, he proposed selling the stakes as some lawmakers have been insisting billionaires on paying taxes when the price of the stocks they hold goes up. Also when they don’t sell any shares.
However, unrealized gains or “billionaire tax,” was eliminated from Joe Biden’s budget, which is still being negotiated.
The additional share sales were separate and provided Must with reserves of cash, considering his wealth is majorly tied to his stakes in SpaceX and Tesla.
He also commented on his selling the stakes saying that stocks are pretty liquid and it is not a huge percentage of total issued shares, so it wouldn’t have that much of an impact, and he also said that he is quite comfortable with the outlook for the business.
The unpredictable CEO of Tesla, Elon Musk, has always amazed his Twitter followers and his fans in general by introducing something new in the market. In March this year, He announced on Twitter that Tesla will now accept Bitcoin for Payment. His tweet was followed by an unprecedented wave of the crypto craze. Last month, Musk’s statement went viral when he said Crypro is “impossible to destroy”.
