Friday, May 13, 2022

Musk is “committed” to buying Twitter amid deal speculation

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Elon Musk says he’s “still determined” to buy Twitter amid speculation about the future of the deal.

“Still committed to acquisition,” he wrote in a brief update.

That came about two hours after Mr Musk said he would pause the deal until he gathered more information about the spam and fake accounts on the platform.

“Twitter deal on hold pending details supporting calculation that spam/fake accounts actually make up less than 5% of users,” he wrote in an update Thursday morning. He did not provide any further details about his considerations.

Even before Mr Musk’s tweets, speculation was beginning to grow that he might be considering going out of business. Since the announcement, Twitter’s share price has fallen significantly, well below the $54.20 price offered by Mr. Musk.

He is still able to pull out of the deal, which may not go through for months, although he would have to pay Twitter $1 billion if he chose to do so.

The announcement that the acquisition is now “on hold” led to further indications that Mr Musk may be looking for a way out of the deal. Analysts noted that the tweet itself had caused even more price declines – falling more than 20 percent in premarket trading – pushing it even further from the price offered by Mr Musk.

There have also been questions about Mr Musk’s funding of the deal, some of which depends on his Tesla shares, which have also fallen in value. Mr Musk is reportedly looking for a new financing structure that would avoid using these shares.

After two hours of speculation, Mr Musk released the latest short tweet, but again gave no further details on the status of the deal or the reasons for its postponement.

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