Elon Musk says Twitter deal "temporarily on hold" – Axios

Elon Musk tweeted Friday morning that his $44 billion deal to buy Twitter is “temporarily on hold” as he seeks more details on the platform’s new estimate that spam and fake accounts make up less than 5% of users.

Why it matters: Musk provided few details, but the tweet from his official account will ignite havoc in the tech and financial worlds. Twitter shares extended their fall in pre-market trading.

  • “Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” Musk said.
  • The company’s shares plunged more than 17% in pre-market trading in response to the news. Tesla’s shares rose about 5%.

The big picture: Musk’s takeover bid has been wrought with so many twists and turns that Wall Street is beginning to feel skeptical that it will even happen.

  • For Musk to liquidate a significant amount of his Tesla stake and to wrangle bankers into giving him billions of dollars in financing, only to backtrack due to a single article, shows how manic the entire takeover process has been.
  • Most acquirers go through a thorough due diligence process to address these types of concerns before submitting a formal bid.

Be smart: The tweet comes a day after Twitter’s CEO ousted two of the company’s top execs and paused hiring, in an effort to be more fiscally responsible.

  • While sources say the changes were made outside of Musk’s purview, there’s no question that a looming takeover bid is adding pressure on the company to become more innovative and profitable.
  • Sources tell Axios that internally, employees are exasperated by the whole process.
  • The potential sale already caused a lot of concern about job security, and morale has been low. A pivot away from a sale would’ve been a relief, but the bait and switch is just as exhausting.

Our thought bubble: There’s been speculation for weeks that Musk would walk away, and he just took a giant first step.


Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.