Tesla falls back with Elon Musk's Twitter pursuit a potential near-term overhang

Apr. 14, 2022 12:47 PM ETTesla, Inc. (TSLA), SPACEBy: Clark Schultz, SA News Editor55 Comments

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Tesla (TSLA -3.9%) traded lower on Thursday after Elon Musk offered to buy Twitter in a deal that could theoretically lead him to sell or borrow against his shares of Tesla or SpaceX (SPACE).

Bloomberg estimated that Musk has already borrowed about $20 billion against his Tesla (NASDAQ:TSLA) and SpaceX (SPACE) shares, which gives him another $35 billion remaining that he can pledge in a loan against the two companies he controls.

Analysts do not see a large sale of TSLA shares by Musk as the likeliest outcome of the Twitter pursuit, but call it a near-term overhang. There is also little indication that he wants to reduce his SpaceX (SPACE) stake.

"Musk’s 'best and final' $43 billion non-binding offer has numerous conditions, including completion of financing, which we believe give it a low probability of success," noted Bloomberg Intelligence credit analyst Robert Schiffman on the development.

Musk could also partner with a prominent firm or investor group in the Twitter buyout scenario to avoid selling a large number of shares.

Catch up on all the latest Musk-Twitter developments.

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