Tesla shares rally after CEO Musk says he has sold ‘enough’ stock

Tesla shares rally after CEO Musk says he has sold 'enough' stock

Tesla CEO Elon Musk speaks at his company’s factory in Fremont, California, June 22, 2012, as the car company began delivering its Model S electric sedan. REUTERS/Noah Berger

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San Francisco, Dec 22 (Reuters) – Tesla Inc (TSLA.O) shares surged 6% on Wednesday after Chief Executive Elon Musk said in an interview he has sold “enough stock” following several weeks of share sales by the billionaire.

Musk gave conflicting statements on Tuesday and Wednesday as to whether he may or may not be done with his stated goal of selling 10% of his shares.

“I sold enough stock to get to around 10% plus the option exercise stuff and I tried to be extremely literal here,” he said in an interview on Tuesday with conservative satirical website Babylon Bee.

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But on Wednesday he suggested he may not be done selling shares. “This assumes completion of the 10b sale,” he tweeted, possibly referring to his prearranged sales plan related to his options.

Under the Rule 10b5-1 trading plan set up in September, he has exercised stock options that expire next year and sold a portion of the stocks to pay for taxes, according to Tesla filings.

Musk said on Nov. 6 he would sell 10% of his stake if Twitter users agreed. Tesla shares, which had hovered near record highs, lost about a quarter of their value soon after that.

Following a flurry of sales, Musk still has more than 3 million stock options that expire in August next year.

On Tuesday, Musk sold another 934,091 shares, bringing the total number of shares he has offloaded to 13.8 million – shy of the 17 million or so shares he was expected to sell.

Tesla shares were up 6.2% at $996.65 on Wednesday afternoon, off an earlier high at $1,015.66.

Asked whether he sold the stock because of the Twitter poll, he said on Tuesday he needed to exercise stock options that are expiring next year “no matter what.” He added he sold additional “incremental stock” to get near 10%.

Of the 13.8 million shares sold, 8.4 million were sold to pay taxes related to his options exercise, according to Tesla’s securities filings.

On Sunday, he said on Twitter that he would pay more than $11 billion in taxes this year.

Musk, who moved the company’s headquarters from California to Texas earlier this month, in Tuesday’s interview also criticized California for “overtaxation” and “overregulation.”

“California used to be the land of opportunity and now it is … becoming more so the land of sort of overregulation, overlitigation, overtaxation,” he said, adding it was “increasingly difficult to get things done” in California.

He has said his personal tax rate tops 50%, which would include federal and state income taxes. Musk said last year that he had relocated from California to Texas where he faces no income tax.

Musk also said the “metaverse,” a technology buzzword that refers to shared virtual environments, is not compelling, adding that playing video games with goggles can cause motion sickness. “Sure, you can put a TV on your nose.”

“I think we’re far from disappearing into the metaverse. This sounds just kind of buzzword-y.”

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Reporting by Hyunjoo Jin in San Francisco
Additional reporting by Ben Klayman in Detroit and Noel Randewich in Oakland, Calif.
Editing by Bernadette Baum and Matthew Lewis

Our Standards: The Thomson Reuters Trust Principles.

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