Elon Musk has his back. In the midst of a legal tussle over the broken promise of his takeover of Twitter, the multibillionaire sold in early August for nearly $ 7 billion in shares of his Tesla automotive group.
In a tweet published overnight from Tuesday to Wednesday, he explained that he wanted to “avoid an emergency sale of Tesla securities”, in the scenario – which he hopes is “improbable” -, where he would be forced to buy Twitter and would lose the support of some of its financial partners. In April, he had already sold some $8.5 billion worth of shares in his automobile group to prepare for the acquisition of the social network. At the time, Elon Musk had however assured that there would be no other sales of Tesla titles.
A trial scheduled for October
With now more than 15 billion dollars in his pocket from these sales of stakes, the fiery entrepreneur could be preparing either to pay compensation or to finally finance the takeover of Twitter. “Musk may attempt to resolve this explosive situation before the October trial date (…) with a massive out-of-court settlement,” suggested Wedbush Securities analyst Dan Ives. The latter considered that the chances of an agreement with Twitter possibly involving a payment “ranging from 5 to 10 billion dollars” were “now more likely”. Tesla shares rose 2.50% to $871.25 around 6 p.m. That of Twitter climbed 3.56% to 44.35 dollars.
On Saturday, Elon Musk had challenged the boss of Twitter to publicly debate and proved the part of false accounts on the social network, point of disagreement put forward by the multi-billionaire to withdraw his purchase offer. Elon Musk signed a $44 billion deal in April to buy Twitter, before unilaterally breaking it off in early July. The boss of Tesla believes that Twitter lied about the proportion of automated accounts and spam on its platform, and even claims that the network “fraud”, by increasing the number of monetizable accounts.
The legal battle has begun: a trial is due to open on October 17 before the Delaware Court of Chancery, a court specializing in business law, and last five days. The odds that Elon Musk will get out of it by paying only the indemnities for breaking the agreement (one billion dollars), or that he will be declared in his rightful right, are considered very low by the experts.