The billionaire who claims to be the third largest shareholder in the company is calling on the company to announce a $15 billion stock buy back as the company's share price continues to fall.
In a message to Martin Viecha, the senior director of investor relations, Koguan said the company should immediately announce that it plans to buy back $10 billion of its shares. He said that the free cash flow should be used to fund the buy back and that it shouldn't affect the company's $18 billion cash reserves. CNBC requested comment fromTesla, but they did not reply immediately.
There was a broad market sell-off on Wednesday. The company's stock is down more than 30% this year.
When a public company uses cash to buy shares of its own on the open market, it's a method that firms use to return capital to shareholders.
Buybacks reached a record high of $850 billion in 2021. During the year, Apple bought back more of its own stock than any other public company. Another $70 billion was announced last month.
According to a Forbes report from October, Koguan made billions by going long on the electric vehicle maker. After selling his shares in other companies, Koguan went all in on the company.
Koguan said he was the only person he really respected.
Musk, the world's richest person on paper, said Tuesday that he put the deal on hold until he gets more information about the number of fake accounts on the social media network.
According to analysts at Jeffries, Musk looks to be trying to drive down the price due to the recent market sell-off.
According to the research note, the recent comments by Musk suggest he is trying to negotiate a lower offer price.
We believe that Musk is using his investigation into the % of fake TWTR accounts as an excuse to pay less. In reality, the stock is down 25% year-to-date, and Musk knows that he may be overpaying for the asset.
Musk's plan to buy Twitter has been a massive overhang on the company's stock.
In the last few weeks, Musk has had a black eye.
The way he has handled this has been unconscionable, and it has left a stain on the company.
All Rights Reserved © 2024
