“Still committed to acquisition.”
Elon Musk still wants to buy Twitter but wants more information about the spam accounts. From Bloomberg:
The billionaire initially sent an early tweet saying the $44 billion deal is pending until he receives more information about the proportion of fake accounts on the social media site, which sent Twitter stock tumbling as much as 25% in premarket trading. A few hours later he sent another tweet saying he is “still committed” to the deal. Twitter’s shares recouped some of their losses but were down about 10%.
Musk said he was waiting for details on a recent filing from Twitter that fake accounts on the social media platform contributed less than 5% of its users. Twitter said in its latest quarterly results “that the average of false or spam accounts during the first quarter of 2022 represented fewer than 5% of our monthly daily active users during the quarter.” However, Twitter said it applied “significant judgment” to its latest estimate, and the true number could be higher.
Still committed to acquisition
— Elon Musk (@elonmusk) May 13, 2022
Musk has made spam and fake accounts a priority once he takes over. Twitter requires the owner of automated accounts to label the account as one.
Spam accounts are annoying and fill mentions and timelines to sell items or services. The accounts could also lure people to websites that will hack into their computers and steal information.
If our twitter bid succeeds, we will defeat the spam bots or die trying!
— Elon Musk (@elonmusk) April 21, 2022
Some analysts think Musk might be doing this as a way to get out of the deal (even though he reiterated his commitment to buy it) or lower the $44 billion price tag:
Mr. Musk might be using Twitter’s recent disclosure as a means to get out of or renegotiate the deal, said Daniel Ives, a technology analyst at Wedbush Securities. One reason is the impact on Tesla shares since the deal was announced.
“Leveraging his stock and potential sales of Tesla is a huge overhang on the stock,” Mr. Ives said.
Susannah Streeter, an investment analyst at Hargreaves Lansdown, said there will be skepticism whether the fake accounts are the real reason for the delaying tactic. “The $44 billion price tag is huge, and it may be a strategy to row back on the amount he is prepared to pay to acquire the platform,” she said.
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