Elon Musk isn’t sure he wants Twitter anymore

Elon Musk isn’t sure he wants Twitter anymore
Written by madishthestylebar

Tesla boss Elon Musk said on Friday he was suspending the takeover of Twitter pending details on the proportion of fake accounts on the social network. However, he claims to be “still committed” to buying the social network. The action of the group, listed on the New York Stock Exchange, plunged about 15% after this announcement in electronic trading before the opening of Wall Street. It had tumbled 25% earlier in the day.

“Twitter acquisition is temporarily on hold pending details that spam and fake accounts represent well under 5% of users,” Elon Musk wrote on the platform, where he has nearly 93 million subscribers. Contacted by AFP, Twitter did not react immediately.

A 44 billion dollar contract

The board of directors of the social network with tweets accepted at the end of April a takeover offer of 44 billion dollars formulated by the whimsical leader of South African origin. Elon Musk promised to rid Twitter of spam, authenticate users and increase transparency without specifying how he intended to implement this project.

The company indicated at the beginning of May, during the presentation of its quarterly results, to count, on average from January to March, 229 million daily users said to be monetizable, that is to say exposed to advertising. She had estimated on this occasion that less than 5% of them were spam or fake accounts.

A “key indicator”

The proportion of fake accounts is “a key indicator” for Twitter, explains Susannah Streeter, market analyst for Hargreaves Lansdown, because “calculating the precise number of people who actually tweet is considered crucial for future revenue streams through advertising or paid subscriptions on the site. »

In addition to his desire to fight spam, Elon Musk said he wanted to make Twitter a bastion of freedom of expression and said he was ready to reinstate former US President Donald Trump, whose account was permanently suspended after the attack on the Capitol in January 2021.

“Friday the 13th Horror Movie”

Since the takeover bid by the boss of Tesla and SpaceX, Twitter’s stock market value has shrunk by billions of dollars. The title traded Friday at just over $38, well below the purchase price of $54.20 per share offered by the billionaire.

Wedbush Securities’ Dan Ives said Elon Musk’s latest tweet “will turn the Twitter takeover circus into a Friday the 13th horror movie.” is about to go down the drain 2) it’s an attempt by Musk to negotiate a lower purchase price or 3) Musk just wants to walk away from the deal with a $1 billion severance fee dollars”, details the analyst in a note.

A withdrawal to protect Tesla?

The leader had however sought to reassure on his ability to finance the operation, planning to have recourse to a considerable personal contribution and to request a bank loan as well as a loan on margin in which he would pledge his Tesla shares as collateral.

Earlier this month, Elon Musk claimed to have raised just over $7 billion from various investors, Oracle co-founder Larry Ellison and Saudi prince and businessman Al-Walid bin Talal. But for Dan Ives, the entrepreneur has overestimated the strength of his Tesla shares, whose price has fallen sharply since the announcement of the takeover of Twitter, and could seek to protect the manufacturer of electric vehicles.

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