Infotech Elon Musk suspends his plan to buy Twitter, the action collapses on Wall Street

Elon Musk suspends his plan to buy Twitter, the action collapses on Wall Street




Elon Musk, boss of Tesla and the richest man on the planet, indicated this Friday, May 13, to suspend “temporarily” the takeover of Twitter pending details on the proportion of fake accounts on the social network. The action of the group, listed on the New York Stock Exchange, plunged about 20% after this announcement in electronic trading before the opening of Wall Street.

Why Elon Musk buys Twitter: the underside of a 44 billion bet

“Twitter acquisition temporarily on hold pending details that spam and fake accounts represent well under 5% of users”wrote Elon Musk on the platform, where he has almost 93 million subscribers. Moments later, the multi-billionaire assured, in a new postbe “always engaged” to buy the social network. Contacted by AFP, Twitter did not react immediately.

The sequel after the ad

229 million monetizable daily users?

At the end of April, the board of directors of the social network with tweets accepted a takeover offer of 44 billion dollars (41 billion euros) 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.

What Twitter will look like after the Elon Musk takeover

The company indicated at the beginning of May, during the presentation of its quarterly results, to have an average of 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.

In addition to his desire to fight spam, Elon Musk said he wanted to make the platform 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 Capitol Hill by his supporters in January 2021. Since the takeover bid by the boss of Tesla and SpaceX, the market value of Twitter has fallen by several billion dollars.

” Horror movie “

The title traded Friday at just over $36, well below the purchase price of $54.20 per share offered by the billionaire. For Wedbush Securities’ Dan Ives, Elon Musk’s tweet “Will turn the circus of Twitter takeover into a Friday the 13th horror movie”. The analyst comments:

The sequel after the ad

“Wall Street will now assess 1) that the deal is about to fall through 2) that it is an attempt by Musk to negotiate a lower purchase price or 3) that Musk simply wishes to withdraw from the transaction with a break fee of $1 billion. »

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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, Mr 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: “The fact that Musk is creating such uncertainty with a tweet [et non un document boursier] is very disruptive for us and for Wall Street” and arouses “many questions but no concrete answers as to whether the transaction will take place”.



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