Elon Musk Unloaded Billions Of Tesla Inventory — And Nonetheless Owns Extra Than Final 12 months

SpaceX founder and Tesla CEO Elon Musk holds a helmet as he visits the development website of Tesla’s Gigafactory in Grünheide, close to Berlin, Germany, on Could 17, 2021.

Michelle Tantucci | Reuters

Elon Musk netted a torrent of inventory gross sales, possibility workout routines, tax paid gross sales and gifted shares for practically $22 billion final yr. But even after taking off a lot Tesla inventory, he nonetheless owns a big a part of the corporate due to his compensation bundle.

Musk bought $16 billion price of shares final yr and gifted 5 million shares to an undisclosed charity or recipient in November, price about $6 billion, in keeping with a submitting with the US Securities and Change Fee on Monday. The gross sales and presents deliver their whole to $22 billion – a mixture of tax funds, money of their pockets, and presents.

But as a result of nature of the choice train, Musk really ended the yr with a bigger possession stake — and extra shares — in Tesla. In 2012, Musk was awarded choices on 22.8 million shares when he started promoting.

The way in which the choices train works is that Musk first started changing 22.8 million choices into shares. The strike worth of the choices was solely $6.24, so he may have paid $6.24 for every possibility and acquired a share of Tesla inventory, which was buying and selling at a decline of over $1,000 previously.

With every possibility conversion, he’ll concurrently promote the shares to pay taxes, because the choices are taxed as revenue. Even when he was unloading billions of {dollars} price of shares to pay taxes, he was nonetheless amassing a big quantity of inventory at a decrease possibility worth – thus growing his possession of the corporate. .

Musk bought 15.7 million shares for $16.4 billion in whole. Add to this the gifted shares, and so they took off a complete of 20.7 million shares. But he gained 22.8 million shares by means of the choice train — leaving him 2 million extra shares in Tesla on the finish of the yr. He at the moment owns 172.6 million shares, which provides him a 17% stake within the firm, making him the most important particular person shareholder.

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Musk started his inventory exercise with a ballot on November 6, telling his followers, “Having a tax avoidance device has made lots of unrealized positive factors these days, so I will promote 10% of my Tesla inventory.” I suggest. Do you assist it?” Musk vowed to observe the outcomes of the ballot, which ended with 58% in favor of Promote and 42% towards.

In the long run, he made good on his promise to promote 10% of his stake. However he gained much more with choices, giving him a round-trip inventory journey that left him with billions in money, the most important single tax payout in U.S. historical past, and much more Tesla shares.

Musk’s possession – and $227 billion fortune – is prone to skyrocket once more sooner or later. His subsequent massive pay bundle, which could possibly be even larger than the 2012 award, expires in 2028.

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