Tesla

Elon Musk to buy $20 million in Tesla stock

Tesla Inc (TSLA.O) CEO Elon Musk will purchase company stock in the next open trading session worth $20 million, the company said in a filing on Wednesday.

Tesla and Musk have each agreed to pay $20 million under a settlement with the U.S. Securities and Exchange Commission of a fraud lawsuit relating to tweets sent by Elon Musk back in August. Elon Musk’s purchase of $20 million will essentially cover the cost of the fine the company has to pay.

Elon Musk had shocked investors by announcing on Twitter on August 7 that he may take Tesla private in a $72 billion transaction that valued the company at $420 per share. Elon Musk’s tweets had initially helped push Tesla’s stock price more than 13%, but have since fallen back.

Elon Musk had shocked investors by announcing on Twitter on August 7 that he may take Tesla private in a $72 billion transaction that valued the company at $420 per share. Elon Musk’s tweets had initially helped push Tesla’s stock price more than 13%, but have since fallen back.

The SEC called Elon Musk’s claims “false and misleading” and risked misguiding investors into thinking the funding was already secured.

Besides, both Tesla and Elon Musk agreeing to purchase $20 million in Tesla stock, Elon Musk will step aside as Chairman for Tesla for three years. Tesla must now hire an independent chairman to oversee the company.  Elon Musk will be allowed to maintain his position of CEO, though. The settlement was approved by a U.S. federal judge on Monday evening.

Elon Musk has taken to Twitter yet again since the agreement with the SEC was reached referring to the SEC as the “Shortseller Enrichment Commission” and sarcastically praising the regulator’s work. It is thought that his tweets will not derail the agreement.