The move comes as Tesla’s stock price has fallen some 30 percent, to just under $660, over the past month. And it highlights Musk’s commitment to the Twitter deal, even as he continues to rail against the company. Shares of Twitter are up 10 percent on the news, but at $39, remain well below the $54.20 a share Musk has agreed, signaling that investors still aren’t certain of the deal.
Musk had already reduced his reliance on his Tesla shares. His initial plan was to put $33.5 billion up to buy Twitter, and finance the rest, $11 billion, with debt. Of the $33.5 billion in equity, $21 billion was directly from him,with $12.5 billion coming through a bank loan against his Tesla shares. He later brought in $7 billion from outside investors, cutting the loan to $6.25 billion. With this latest announcement, he is scrapping the loan entirely.
Still, the reason for the latest switch is not clear. It could be that borrowing against Tesla stock put the deal at risk, now that the carmaker’s share price has dropped. (Musk has already borrowed tens of billions against his shares.) Musk also says he is continuing to talk with Twitter shareholders, including the co-founder Jack Dorsey, about rolling over their stakes to help finance his deal.
None of this has stopped Musk from throwing jabs. He took aim at Twitter after the F.T.C. and Justice Department fined the company $150 million for doing less than it had promised to protect users’ data from marketers. “If Twitter was not truthful here, what else is not true?” Musk said. “This is very concerning news.”
Gun stocks rise despite E.S.G. concerns
The rise of E.S.G. investing, as well as mass shootings like the one that happened this week in Uvalde, Texas, put a spotlight on the role financial institutions play in propping up gun companies. Shares in Smith & Wesson, Sturm Ruger and Vista Outdoor, among other gun companies, rose yesterday, as is typical after mass shootings.
E.S.G., which stands for environmental, social and governance, has become an important force on Wall Street. Some call it “woke capitalism.” Nonetheless, many money managers still own gun stocks. BlackRock and Vanguard invest in gun stocks, for clients, mostly through funds that track the market or portions of it. Sellers of guns and ammunition, like Walmart, are even more common in broad-based mutual funds, index funds and pension funds.