Elon Musk buys Twitter, Tesla loses $126 billion in value

Tesla shares fell 12.2% last Tuesday, with the company losing $126 billion in value, Reuters reported. The reason for this is cited as investors’ fear of large stock sales. According to them, Elon Musk may sell some of the shares to finance the deal to buy Twitter for $44 billion.

The truth is that Tesla CEO Elon Musk refused to explicitly specify where he would be getting capital from to buy Twitter shares. Tesla is not involved in the billionaire’s deal, but the company’s stock has suffered nonetheless. It was stated that Elon Musk said he would set aside $21 billion from his personal wealth to buy Twitter, and another $25.5 billion was sent to him by a group of banks led by Morgan Stanley, but secured by Tesla shares.

Tesla investors are worried

In addition, the decrease in the value of Tesla shares is also linked to the situation in the stock market. On Tuesday, investors noted that the Nasdaq closed the day at its lowest level since December 2020. On the other hand, it is noted that Twitter shares also lost value. It was reported on Tuesday that it fell 3.9% in price to $49.68. However, Elon Musk had agreed to buy shares of the company on Monday for $54.20 per share.

Such a sharp decline in the value of Tesla shares is due to investor sentiment. They are concerned about a major Musk deal that could hurt the company’s finances. According to OANDA senior analyst Ed Moya, a prolonged decline in shares will hurt the company. Moreover, it will endanger Tesla’s income sources. Musk derives most of his income from Tesla shares.