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Tuesday, Jul 22, 2025

Tesla shares sink amid concerns about Elon Musk's proposed takeover of Twitter

Tesla shares sink amid concerns about Elon Musk's proposed takeover of Twitter

Elon Musk's offer to buy Twitter has yet to be approved by shareholders but investors in his car-maker Tesla are already concerned.

Tesla shares sank 12.2% overnight, wiping $126bn off the company's value amid investor concern that chief executive Elon Musk might sell his shares to fund equity for his $44bn buyout of Twitter.

The drop in Tesla shares would equate to a $21bn drop in the value of Mr Musk's stake in the car-maker - the same as the $21bn in cash he has promised to put towards the Twitter deal.

OANDA senior market analyst Ed Moya warned: "If Tesla's share price continues to remain in freefall that will jeopardise his financing."

Analysts also said investors are worried that Mr Musk, who also runs SpaceX, tunnel digging firm The Boring Company, and computer-brain interface company Neuralink, will be distracted by the social media company and less interested in running Tesla.

Edward Jones senior equity analyst Jeff Windau said: "He's going to be spending more time with another venture.

"There's a potential limit on the amount of bandwidth that you can apply to each of these companies."

Twitter shares also fall


Twitter's shares were also down on Tuesday - falling 3.9% to close at $49.68.

Mr Musk agreed to buy the company on Monday for $54.20 per share in cash.

The gap between his offer and Twitter's actual share price reflects investor concerns that the decline in Tesla shares - which provide the bulk of Mr Musk's fortune - could lead him to have second thoughts about buying Twitter.

Amazon founder Jeff Bezos has also asked whether Mr Musk's deal to buy Twitter will give China "a bit of leverage" over the platform, as Tesla has a big plant in Shanghai.

Free speech concerns


Earlier on Tuesday, Mr Musk responded to concerns that his vow to turn Twitter into a haven for free speech could see an increase in the hate and disinformation the site has sometimes struggled to deal with in the past.

He tweeted on Tuesday night: "The extreme antibody reaction from those who fear free speech says it all.

"By 'free speech', I simply mean that which matches the law.

"I am against censorship that goes far beyond the law.

"If people want less free speech, they will ask government to pass laws to that effect.

"Therefore, going beyond the law is contrary to the will of the people."

Mr Musk uses his own Twitter account to post about technology and trade, occasionally answering questions from his 85 million followers.

But he has also posted jokes about women's breasts, compared Canada's prime minister to Hitler, and accused a rescue diver of being a "pedo" in the past.

The diver had criticised Mr Musk's proposal to use a submarine in the rescue of a group of boys trapped in a Thai cave. Mr Musk later won a defamation suit brought by the diver, saying he never intended "pedo" to be interpreted as "paedophile".

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