Musk, who is the world’s richest person and Tesla’s top shareholder, promised last weekend that he would sell 10% of his shares if his Twitter followers approved the move.
The billionaire has taken advantage of a meteoric rally in Tesla’s stock price that has helped the firm’s value more than double since June, surpassing $1 trillion.
On Friday, new filings with the US Securities and Exchange Commission showed that Musk had sold about 640,000 shares for roughly $687.3 million.
Earlier this week, he sold about 5.1 million shares worth about $5.69 billion.
He now needs to offload about 10 million more shares to fulfill his pledge to sell 10% of his holdings.
Musk faces huge tax bill
Musk sold the shares to pay what’s expected to be a hefty tax bill on stock options granted by Tesla in September. “I only have stock, thus the only way for me to pay taxes personally is to sell stock,” he had said. Tesla does not pay him a cash salary.
The options are part of a compensation package agreed on in 2018 that provided the CEO with shares if Tesla hit certain financial targets.
Musk still owns about 167.5 million shares, just under 17% of the company, according to the SEC filings and data provider FactSet.
Musk’s tweet prompted heavy selling in the stock this week. Tesla’s shares fell for four out of five days, sliding a total of 15%.
The market value lost this week, some $187 billion, is more than the combined market capitalizations of Ford Motor Co and General Motors Co.
Cashing out at the most opportune time
By getting Twitter users to greenlight the sales, Musk has blunted potential criticism of cashing out at a time when Tesla’s valuation has become frothy and shares are at record highs.
Regulatory filings showed the tech entrepreneur had initiated the sale of at least some of these shares ahead of the Twitter poll.
Tesla remains the world’s most valuable automaker and Musk is the wealthiest person in the world, according to Forbes, with a net worth of around $278.7 billion.
The share sale came in the same week as Telsa’s competitor Rivian Automotive Inc. made its market debut.
The electric carmaker rocketed to a $86 billion market value despite having no revenue, in another sign of the current stock market euphoria.
