Tesla stocks tank over 12% after Elon Musk buys Twitter 

On Tuesday, Elon Musk’s Tesla Inc lost $126 billion in value after the tech mogul bought the micro-blogging site Twitter.   

Investors seem to be worried that CEO Elon Musk would have to sell his shares in the electric vehicle and clean-energy company. 

It is interesting to note to note that Elon Musk needs to fund $21 billion in equity contribution to Twitter Inc's $44 billion acquisition. 

Despite the fact that Tesla is not a party to the Twitter deal, the American automobile company’s stock is being targeted by speculators since Musk has refused to reveal the acquisition's funding source publicly.  

This drop in the Tesla Inc valuation has also hit the tech billionaire hard. The 12.2 per cent decline in Tesla's shares on Tuesday translates to a $21 billion loss in the value of his holdings in Tesla. 

Vinay Bharathwaj, co-founder and co-CEO of Stockal believes that the company would witness a downtrend in the short-term. He told Business Today, "In the short term, there will be questions over the entire deal structure as the Tesla shareholders will not see any clear value for them in this decision. It might appear like a frivolous bet to most stakeholders causing a short-term impact on the stock prices of Tesla.” 

But he still believes that the stock has potential in the long term. He said, "Tesla is a market leader as of today in the EV segment. As long as Tesla beats the delivery expectations, Q-o-Q results and continues to bring forth innovative products, the company should operate fine." 

Interestingly, even Twitter shares were hit after the Elon Musk bought Twitter. The micro-blogging site’s shares slid 3.9 per cent and closed at $49.68. 

The micro-blogging site was also having a bad day on Apple store. Elon Musk recently tweeted that Truth Social, Donald Trump's version of Twitter, is on the top and is beating apps like Twitter and TikTok. 

Earlier on Monday, it was reported that Elon Musk had secured a $46.5 billion financing package to acquire the micro-blogging platform and that discussions between board members and Musk were ongoing to finalise the deal's parameters. 

Late Monday, Twitter announced that it has reached a "definitive agreement to be bought by an entity entirely owned by Elon Musk for $54.20 per share in cash in a transaction valued at about $44 billion." Twitter will become a "privately held company" upon the completion of this deal. 

Also Read: Elon Musk buys Twitter for $44 billion

Also Read: And it’s done. Elon Musk now owns Twitter.