Elon Musk sparks confusion over Twitter purchase and causes its downfall

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Elon Musk sparks confusion over Twitter purchase and causes its downfall

Elon Musk has once again put this Friday, May 13, in suspense to the investors of Twitter (-8.23%) after first ensuring that temporarily suspended the purchase of the platform, which he announced for about 44,000 million dollars, and only two hours later he rectified and wrote that he remained committed to his acquisition.

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“The Twitter deal is temporarily suspended pending details that support the calculation that the fake and spam accounts they represent less than 5% of users,” Musk wrote at 5:44 a.m. New York time (9:44 GMT) in a message, posted of course on his Twitter account.

His message was accompanied by a news item that assured that Twitter calculates that its false accounts represent less than 5% of the “monetizable daily users”so his comment made it clear that the businessman did not give credibility to the figures offered by the company.

According to the agreement reached last month between the company and the tycoon, in the event that one of the parties breaks the trade agreementthis must pay the other 1,000 million dollars.

A STOCK MARKET TSUNAMI

The reaction was immediate and almost immediately after the publication of his words, the titles of Twitter fell in the electronic operations prior to the opening of the Stock Exchange wall street almost 20%, to around $36.5 per share.

In addition, in just two hours the message generated more than 10,000 comments and was retweeted more than 16,000 times.

The dust raised by the richest man in the world about the company he wants to buy did not begin to clear until at 7:50 local time (11:50 GMT) Musk himself intervened in the discussion unleashed in the social network to ensure: “Still committed to the acquisition.”

After this second statement, the shares began to recover from the fall, although just after the opening of Wall Street they were still down 9.92% or $4.47down to $40.61 per share.

Two and a half hours after the start of the stock market, the shares were still losing 8.23% compared to the close of the day on Thursday.

THE DEPRECIATION OF TWITTER

Musk offered to buy Twitter for a fee $54.2 per sharewhose value is now around 41 dollars.

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In other words, at this time the company worth about 24% less of the 44,000 million dollars that Musk promised to pay, for which some analysts think that the tycoon would be looking for a pretext to renegotiate the agreement.

The founder of the luxury electric vehicle company Tesla must contribute 21,000 million dollars from his pocket and 23,000 through bank loans.

In recent weeks, several investment funds and other millionaires have committed to contribute 7,000 million dollars of the 21,000 million that Elon Musk promised to pay out of his own pocket.

Among the tycoons backing Musk are the Oracle co-founder Lara Ellisonthe financial firm Sequoia, the cryptocurrency exchange platform Binance and the Saudi prince Ali Walid bien Talal, according to a document provided to the Securities and Exchange Commission of the United States (SEC, for its acronym in English).

The businessman had announced that his intention was take the company out of the stock market once the purchase operation had concluded and that he also intended to occupy the position of chief executive officer (CEO), according to the CNBC channel, at least for “a few months”, and that after three years he would sell it again.

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He also said that he would lift the veto on the social network of former US President Donald Trump, whose account has been closed since the assault on the Capitol by thousands of his followers in 2021.

Twitter earned 513 million dollars (more than 490 million euros) in the first quarter of the year, which is seven times more than a year earlier (655% more), driven by the sale of its mobile advertising business MoPub.

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