Wells Fargo says Musk’s Twitter bid raises concerns for Tesla holders

If Elon Musk’s proposal to acquire Twitter (TWTR) is successful, there are two concerns from a Tesla (TSLA) shareholder perspective, Wells Fargo analyst Colin Langan tells investors in a research note. One, Tesla is currently in the early days of ramping two factories in Austin and Berlin, which will likely double its global capacity, and running Twitter would be a possible distraction for a CEO that already has a full plate, says the analyst. Two, the takeover financing terms are unclear and Musk will need $39B to complete the deal, with his most liquid assets being his Tesla shares valued at $170B, notes Langan. Therefore, there is risk of Musk deciding to sell more Tesla shares to fund the takeover, which could put pressure on the stock, the analyst contends. Today’s news has no impact on Langan’s long-term view, but he says concerns on Musk’s focus and the potential need to sell shares will likely put pressure on the Tesla shares near term. The analyst keeps an Equal Weight rating on Tesla with a $910 price target. The stock in midday trading is down 4% to $985.26.