Elon Musk warned his £32bn Twitter bid risks damaging Tesla

Musk warned Twitter bid is risk to Tesla: Analysts say tycoon would likely need to sell shares in the electric car firm to fund £32bn takeover

Elon Musk’s audacious attempt to buy Twitter poses a threat to Tesla, a leading investment group has warned.

The billionaire tycoon launched a £32billion takeover bid for the social media group last week – sending shockwaves through Wall Street and the City and prompting a fierce rebuttal from the Twitter board.

As Tesla prepared to publish its latest figures, analysts at Pensions & Investment Research Consultants (Pirc) warned Musk’s battle to seize control of Twitter could be a distraction from his work at Tesla.

Distracted? Tesla boss Elon Musk launched a £32bn takeover bid for Twitter last week – sending shockwaves through Wall Street prompting a fierce rebuttal from the Twitter board

‘This latest episode of the Elon Musk show is a consideration for shareholders of Tesla,’ Pirc said in a report. 

‘Musk is rich, but he does not have unlimited funds, and for his multi-billion bid to come off, it is likely he would need to sell some of his shares in Tesla to finance the deal.

‘And with his time preoccupied running Twitter, a successful acquisition may take Musk’s attention away from the electric car company to the detriment of its operations.

‘That may represent a further investor risk to Tesla shareholders. Even if the bid fails, the fact that the Tesla chief executive seems to be distracted by a social media company may not be seen as a good thing.’

Musk’s bid was followed by a flurry of controversial Twitter posts, including claims it would be ‘utterly indefensible’ for the social media giant not to put his offer to a shareholder vote.

The 50-year-old also said the Twitter board would work for nothing if his takeover succeeds – saving the company more than £2million a year.

Twitter has so far held firm in trying to keep Musk at bay but it is thought he could launch a new bid within the next ten days.

Musk – who also runs aerospace firm SpaceX – is the world’s richest man with a fortune of £200billion. That includes a £130billion stake in Tesla.

Tesla shares have risen nearly 1,800 per cent in the past three years, from just over $50 to around $980.

That values the company at over $1trillion – making it worth more than the next 12 largest carmakers combined.

The marque’s popularity is growing in the UK as drivers look for green cars.

Figures from the Society of Motor Manufacturers and Traders show the two best-selling cars in Britain last month were Tesla’s Model Y and Model 3. However, Tesla has also fallen victim to inflationary pressures that have hit other car manufacturers.

This led to price rises in China and the US, meaning Tesla’s cheapest car now costs $47,000 (£36,000).

Musk has also said the electric carmaker has been hit by tension in the supply of raw materials, which has been made worse by disruption following Russia’s invasion of Ukraine. 

The firm’s new gigafactories in Texas and Berlin, which will make vehicles and its own battery cells, also face challenges of scaling up production with new processes, analysts have warned.

And it was forced to suspend operations in China over lockdown restrictions.

After a three-week closure, Tesla re-opened its Shanghai gigafactory last week, but with strict rules that will require workers to sleep on the factory floor.

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