Elon Musk announced that his $44 billion acquisition of Twitter has been stalled. To back up the microblogging site’s claim that spam or false accounts make up fewer than 5% of its total user base, the wealthy Tesla CEO referenced upcoming details.
In a tweet Friday, Musk shared: “Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users”. He shared a link in his tweet to a May 2 Reuters story titled ‘Twitter estimates spam, fake accounts comprise less than 5% of users -filing’.
In a regulatory filing earlier this month, the microblogging site claimed that during the first quarter, fake or spam accounts amounted for less than 5% of its monetisable daily active users. It also stated that until the deal with Musk is finalised, it faces various risks, including whether advertisers will continue to spend money on Twitter.
Twitter’s stock dropped 20% in premarket trade, according to Reuters. Despite the fact that Musk did not disclose many information in his tweet announcing the deal’s halt, it is likely to cause a stir in the tech and finance worlds.
While Musk had initially announced that he would take Twitter private by buying it for $44 billion with the help of a loan by Morgan Stanley, he later made a filing saying he has received equity commitment from marquee investment houses including Sequoia Capital, Andreessen Horowitz, Larry Ellison, and others.
Twitter Acquisition Deal
Elon Musk, a billionaire, has taken ownership of Twitter in one of the biggest tech deals in history. Musk will pay $44 billion for the social network, with shares valued at $54.20 each. On April 14, Musk announced his takeover attempt, calling it his ‘best and last offer.’
However, Twitter initially put in place a “poison pill defence” against the hostile takeover. However, after Musk stated that he had obtained finance, the Tesla board entered into negotiations with the co-founder of the company.
Musk met “privately with some shareholders of the firm to laud the merits of his idea” on Friday, according to the Wall Street Journal, and also made video calls to them to press his case.
