FOLLOW US

Elon Musk's unexpectedly brought Twitter deal back to life, and this will be disastrous for Tesla, Wedbush Securities analyst Dan Ives has warned.

A significant sum of Musk's $250 billion fortune is tied up in Tesla shares and his stake in SpaceX. Ives said that Musk would have to sell more Tesla shares to fund his takeover attempt – which could lead to the electric vehicle maker's stock plummeting further. 

"That's like me giving away caviar to buy a $2 slice of pizza," Ives told BBC's " Today" show Wednesday. 

On Monday, Musk proposed relaunching talks to acquire Twitter at the originally-agreed price of $54.20 a share in a letter addressed to the social media giant's lawyers, according to a Securities and Exchange Commission filing.

Twitter sued Musk in July after he said he was terminating his deal to buy the social platform. His backtracking means he could avoid a costly courtroom battle.

Musk, who is both Tesla's largest shareholder and the world's richest person, has offloaded a significant chunk of his stake in the electric maker this year in a bid to raise cash to fund his Twitter takeover attempt.

He sold $6.9 billion in Tesla shares in August, meaning he has cut down his stake by around $32 billion over the last 12 months.

Ives said at the time that Musk's Tesla stock sale was "writing on the wall that a deal could be on the cards" — and upgraded his Twitter price target from $30 to $50 a share.

Tesla shed 1.26% to trade at $246.29 in Wednesday's premarket, while Twitter slipped 0.48% to $51.75.