The Next Hurdle for Musk’s Twitter Plans

Elon Musk is slowly filling in the blanks on his Twitter purchase. It turns out that while we were all wondering if he would sell more of his Tesla shares to fund the $44 billion acquisition, he was doing just that! But after raising $8.4 billion, he’s done selling shares in the electric car maker, he tweeted Thursday night. That should be good news for Tesla investors. They don’t need to worry anymore about the prospect of his further stock sales pressuring the stock. Well, at least that’s the theory.

Unfortunately, it may not be that simple. Start with the fact that Musk has to come up with a total of $21 billion in cash, on top of the loans he is taking out, to complete the purchase. Taxes will trim this week’s take a bit—let’s assume it gets him a third of the way there. We don’t know how much other cash he had before this week’s sell-off. He raised more than $16 billion selling Tesla shares in November and December, but most of that went to pay taxes and (presumably) his earlier $2.5 billion purchase of 9.1% of Twitter. Odds are he will still need to raise at least $11 billion to complete the Twitter purchase.