Tesla and SpaceX CEO Elon Musk’s plans to buy Twitter might be in danger, at least that is what a report from Washington Post indicates. Following the report, Twitter shares fell on Thursday as the conversation about Musk’s $44 billion deal possibly being called off resurfaced.
From the time the deal to buy Twitter was put in place, Musk has expressed his misgivings about the bots on the platform and even went to the extent of saying that he might walk away from the deal if the number of fake accounts on Twitter are more than 5 per cent.
According to the Washington Post report, Musk has not been able to pin down and percentage of Twitter accounts that are not genuine despite having been given access to internal data. The report also cites an anonymous source who claims that Musk’s team is preparing for a “change in direction”.
Following this report, Twitter’s shares, which were already trading lower than the price offered by Musk, tanked another 4 per cent in after-market trades.
Wedbush analyst Dan Ives reportedly told investors in a note that the “Twitter soap opera” is expected to come to a finale over the next few months as Musk decides on whether he wants to stay, and pay a lower price than the decided $44 billion, or go. Ives also expects Musk to reveal details about his fake account concerns, again, soon.
Musk last publicly talked about these concerns at the Qatar Economic Forum last month where he said that the Twitter purchase remains to be held up by some “very significant” questions regarding the bots on the platform.
While Twitter executives have stood their ground on the claim that less than 5 per cent of the accounts are fake, Musk has refused to believe that. He also, reportedly, has questions about Twitter’s debt.
Ives noted that the chances of Musk buying Twitter as “originally negotiated” are slim and his firm has predicted the chance of the deal happening at a lower price, “at 60 per cent”, with the possibility of Musk trying to walk away after paying the $1 billion termination fee.
Copyright©2022 Living Media India Limited. For reprint rights: Syndications Today