Prime Highlights:
- Elon Musk buys nearly $1 billion in Tesla shares, signaling strong confidence in the company.
- Tesla’s board shows support for Musk’s leadership with a massive compensation plan.
Key Facts:
- Musk purchased 2.57 million shares at prices between $372.37 and $396.54 per share.
- Tesla shares jumped more than 8% in premarket trading following the news.
Key Background:
Tesla CEO Elon Musk has boosted his stake in the company by buying nearly $1 billion worth of Tesla shares, a recent filing shows. The acquisition comes just a week after the automaker proposed an unprecedented $1 trillion compensation package for Musk, signaling strong board support for his leadership.
The transactions, which took place on Friday, involved Musk buying 2.57 million shares on the open market at prices ranging from $372.37 to $396.54 per share. Following the disclosure, Tesla shares surged more than 8% in premarket trading on Monday, reflecting renewed investor confidence. The stock, which has declined about 2% year-to-date, is now on track for a third consecutive session of gains if premarket trends continue.
Musk’s purchase reinforces his ongoing effort to gain greater control over Tesla, where he currently holds a roughly 13% stake. The CEO has previously said he wants more voting power and has suggested he might explore robotics projects outside Tesla if his influence is limited.
Tesla is expanding beyond electric cars, working on robotaxis and robotics, as it aims to become a bigger technology company. Despite the high competition and fluctuating demand, the approval of the large pay plan by the board demonstrates that they have confidence in the leadership of Musk.
Board chair Robyn Denholm addressed concerns about Musk’s political activities, including public interactions with former President Donald Trump, saying these have not affected Tesla’s sales. She added that Musk is now “front and center” at the company, actively guiding its direction.
Analysts say Musk’s investment is a strong sign to shareholders, showing he believes in Tesla’s future. Musk can purchase additional shares to demonstrate that he is invested in the company and that he has a greater stake in Tesla. With the expansion of Tesla, the acquisition demonstrates that he trusts the organization and is backed by the board.
Read Also: UK Fintech SumUp Plans IPO Valued Up to $15 Billion to Fuel Expansion