Elon Musk Will Sell 10% Of His Tesla Stock: Poll Results
Elon Musk’s poll on whether to sell 10% of his Tesla stocks has come to an end and the answer is yes, as 57.9% out of over 3.5 million votes supported the idea.
According to Reuters, Tesla’s CEO has some 23% stake in the company (including stock options). The company’s valuation recently exceeded $1 trillion.
Elon Musk wrote:
“I was prepared to accept either outcome”
The billionaire reportedly needs cash to pay taxes:
“Musk has previously said he would have to exercise a large number of stock options in the next three months, which would create a big tax bill. Selling some of his stock could free up funds to pay the taxes.”
“He has an option to buy 22.86 million shares at $6.24 each, which expires on Aug. 13 next year, according to a Tesla filing. The option exercise could lead to gains of roughly $28 billion based on Tesla’s Friday closing price of $1,222.09.”
As we understand, he will exercise stock options to acquire Tesla shares at relatively low price, but the applied taxes will require selling part of it. In the end, Elon Musk will have a higher number of shares.
Reuters estimates that 10% out of 170.5 million shares (as of June 30) is worth some $21 billion. We guess that it will be enough to pay any taxes. Reuters points out also that Elon Musk has relocated from California to Texas, which should lower his overall taxes (Texas has no income tax).
Many small Tesla shareholders and Elon Musk fans are afraid that after the announcement, the value of their stocks will go down.
An interesting thing is that Elon Musk’s brother Kimbal Musk sold 88,500 Tesla shares on Friday, about a day before the poll.