Twitter deal on hold: Days after acquiring microblogging site Twitter, Tesla CEO Elon Musk said on Friday, May 13, that the deal was temporarily on hold and cited pending details on spam and fake accounts as the reason. “Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” Musk said in a tweet on the day.
However, in another tweet, Musk said he is still still committed to the deal. “Still committed to acquisition,” he said.
Still committed to acquisition— Elon Musk (@elonmusk) May 13, 2022
During premarket trading on Friday, shares of Twitter fell around 20 per cent after the announcement by Musk. Twitter has not yet commented on the development.
Earlier this month, Twitter had in a filing said that there were less than 5 per cent false or spam accounts on its platform that represented its daily monetisable active users in the first quarter of the financial year. “The social media company had 229 million users who were served advertising in the first quarter,” a report by Reuters said on May 2.
Elon Musk, the richest man on the planet, had in April acquired Twitter fully at a closing deal of $44 billion. After inking the deal of the imminent takeover, Musk has promised several changes in Twitter, with the removal of “spam bots” from the platform being one of his priorities. He had called spam bots the “single most annoying problem” of Twitter, and promised to weed them off once he takes over. Twitter regulatory filing on spam accounts came days after Musk made the announcement.
Twitter said in the filing it faced several risks until the deal with Musk is closed, such as whether advertisers would continue to spend on Twitter and “potential uncertainty regarding our future plans and strategy,” Reuters said in its report.
Incidentally, the announcement of Elon Musk’s Twitter takeover being on hold coincides with a few other things. Recently, Twitter shares fell to their lowest levels to below $46 apiece after Musk’s $44 billion deal, which gave rise to a speculation that the billionaire might try to renegotiate the deal. The company’s market value on Tuesday was reduced to $36 billion. It is now being speculated that the Tesla CEO would try to negotiate his offer even though he had not indicated anything at that moment.
Another development preceding Musk’s decision on Friday is that Twitter CEO Parag Agrawal has announced that the company is restructuring its top leadership. A memo obtained by media organisation The Verge indicates that Twitter is letting go of its consumer product leader Kayvon Beykpour and head of revenue product Bruce Falck. Twitter has also reportedly paused its hiring. It was ealier reported that Elon Musk may temporarily lead Twitter as the new CEO.
Elon Musk said Twitter deal was on hold, citing pending details on fake accounts. Later, the announcement sent the stocks of the company in a tizzy.