JP Morgan sues Tesla and Musk sells new shares worth more than 2,700m

The CEO of the car firm Tesla, Elon Musk, has sold since last Thursday another part of its shares in the Californian company for a value this time of 3,139 million dollars (2,774 million euros to current change), according to US Securities and Exchange Commission (SEC) documents consulted by Europa Press.

Since last Monday, November 8, Musk has disposed of 8.230 million shares on the total of 170.5 million titles it owned, all for a total amount of 8,810 million dollars (7,787 million euros).

These operations come after Elon Musk supporters voted in favor of the sale of 10% of its participation, valued at about 21,000 million dollars (18,153 million euros), in a survey on Twitter organized by the company’s CEO himself.

The shares of the electric vehicle manufacturer have shot up 73% so far this year, reaching 1,222.09 dollars (1,055 million euros) on November 5, which meant reaching a valuation of 1.2 trillion dollars (1.03 trillion euros).

On the trading day this Wednesday, the company is up 2.93%, with a price of 1,085.66 dollars (958 euros) compared to yesterday’s market close of 1,054.73 dollars (931 euros). Shares of Tesla have fallen about 18% from their peak earlier this month.

JP Morgan sues Tesla for 143 M

JP Morgan has sued the Palo Alto-based firm for an amount of 162 million dollars (143 million euros), due to the breach of the “guarantees” in the purchase of the company’s shares.

The largest US bank bought the warrants from Tesla on 2014 to help the automaker mitigate the risk that its shares will be diluted by the issuance of convertible bonds, and to make certain federal income tax deductions, according to a lawsuit filed Monday in federal court in Manhattan that Bloomberg records.

When the ‘warrants‘expire, Tesla would have to pay JP Morgan a payment in shares or in cash if its shares were trading above a certain strike price.

Photo: EC.
Do you have Tesla shares? Do like Elon Musk and sell ’em

The Wall Street Journal James Mackintosh

JP Morgan states that it had the ability to adjust the strike price based on factors such as the Tesla stock volatility as it did in August 2018. Now that the warrants have expired, JP Morgan points out that, even though its adjustments “were appropriate and contractually required“Tesla has refused to settle and pay what it owes in full.

Tesla rebutted in February 2019 that the adjustments the bank made six months earlier were “unreasonably fast and they represented an opportunistic attempt to take advantage of changes in the volatility of Tesla shares. ”

However, JP Morgan states that Tesla did not question the calculations, did not support his claim, and has not objected further in the past two years.

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JP Morgan sues Tesla and Musk sells new shares worth more than 2,700m