Elon Musk Suspends Acquisition of Twitter, as the Company Value Drops By Over $9bn in Two Weeks
- Elon Musk has announced a plan not to go ahead with the payment for the acquisition of Twitter and demands clarity
- His decision is coming hours after the value of Twitter shares dropped to $46, well below Elon Musk’s purchase price of $54.20
- The massive drop in the value of Twitter's share has whipped out a whopping $9 billion in two weeks
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Elon Musk, the world's richest man, has postponed his Twitter transaction due to spam and bogus accounts on the microblogging site, just a month after the company's board agreed to sell it to him.
Musk took to his Twitter account to disclose that the deal would be temporarily put on hold until a probe into the percentage held by fake accounts, which the billionaire has threatened to eradicate.
Musk agreed to purchase 100% of Twitter for about $43 billion after gathering funds from banks and other investors to fund the transaction.
Source: UGC
Commenting on Friday, Musk wrote,
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“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users.”
Why the deal was place on hold
Musk had earlier revealed that one of his many goals after the acquisition of Twitter was to eliminate spam accounts, also known as bot.
He had tweeted on April 21 saying:
“If our twitter bid succeeds, we will defeat the spam bots or die trying!”
Again on May 3, 2022 he retweeted:
Reuters reports that bot handles account for about 5% of Twitter’s 229 million users.
"There is so much potential with Twitter to be the most trusted & broadly inclusive forum in the world!
“That is why we must clear out bots, spam & scams. Is something actually public opinion or just someone operating 100k fake accounts? Right now, you can’t tell.”
Twitter value drops
CNBC reports that since Elon Musk's pursuit of the ownership of Twitter, shares of the social media company are dropping.
According to Thursday data, the value of Twitter shares dropped to $45.08 well below the $54.20 that Musk agreed to pay on April 27.
The massive drop means a whopping $9 billion has been whipped off Twitter's market value.
Elon Musk Reportedly Moves to Charge Twitter Users Per Tweet to Generate Revenue Few Days after Takeover
Recall that YEN.com.gh has reported that the world’s richest man, Elon Musk was looking to ask websites to pay Twitter for embedding tweets in order to increase revenue for the social media service.
The billionaire made the suggestion to banks as a way to attract lenders, according to Yahoo news. He secured $13 billion in loans tied to his Tesla stock.
The new strategy was expected to be part of Elon Musk's major choices.
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