Kiichiro Sato/AP
Tesla CEO Elon Musk
- Elon Musk became $1.4 billion on Tuesday richer as Tesla's stock surged after he tweeted that he was thinking of taking the company private.
- With a $25.8 billion net worth, he's the world's 31st richest person.
- He's also Tesla's largest shareholder.
The tweet was only 61 characters long, but it was powerful enough to make Tesla CEO Elon Musk $1.4 billion richer.
Musk tweeted on Tuesday that he was considering taking Tesla private at $420 a share and had secured the funding.
Many other companies would halt trading of their stock before disclosing news of such importance to their shareholders, and the announcement would be made in a regulatory filing. However, Musk is not one to be Twitter-shy, and his unexpected post sent Tesla's shares skyrocketing.
The shares were already flying after the Financial Times reported that Saudi Arabia's investment fund had bought a $2 billion stake in the company.
Musk's tweet was the extra fuel that spiked Tesla's shares within reach of their all-time high. They closed up 11% at $379.57 apiece, lifting his net worth to $25.8 billion. He is the world's 31st richest person, according to a Bloomberg ranking of billionaires.
Musk could climb the ranking faster if investors decide Tesla is worth more than its current $58 billion market cap. As Tesla's largest shareholder, Musk owns nearly 20% of the outstanding shares and stands to gain as the stock price rises.
However, he may not reap an instant reward in the event that Tesla goes private at $420 a share. The value of his shares at that price would total $72 billion, short of the $100 billion performance bar it must cross for him to be able to exercise his $2.6 billion stock-option grant, Bloomberg noted.
Tesla's stock is up 25.5% in August. Investors who bet against Tesla's stock - so-called short sellers - have lost $3 billion on their wagers, according to the financial-analytics firm S3 Partners.
In other words, as Musk has gotten richer this month, his skeptics have lost money.
See also:
- MORGAN STANLEY: Here are the 7 tech companies most likely to get acquired in the next 12 months
- GOLDMAN SACHS: Big-money investors are dominating the market with the help of 10 stocks - here's the list and how they can continue crushing it
Get the latest Tesla stock price here.