Shares of Twitter are falling and shares of Tesla are rising as Elon Musk speculates that he will abandon his £ 35bn deal to buy a social networking platform

  • Elon Musk tweeted that the purchase was “temporarily attached”
  • The ad increases the likelihood that the tycoon will abandon plans to buy Twitter
  • Any such move could cost Mask $ 1 billion (£ 820 million) as a reward for the break.

Shares of Twitter fell and shares of Tesla soared as Elon Musk speculated that he would abandon his £ 35bn deal to buy a social networking platform.

In a tweet that shocked Wall Street and Silicon Valley, Musk said the acquisition was “temporarily suspended.”

The announcement has raised the prospect that the tycoon will abandon plans to buy Twitter – a move that could cost him $ 1 billion (820 million pounds) as a break fee.

Shares of Twitter fell 25 percent on Wall Street before it recouped some of the losses. By contrast, shares of Tesla, which were hampered by fears that Mask’s interest in Twitter would distract him from the electric car maker he runs, rose 7 percent.

The 50-year-old billionaire said he was postponing the deal due to concerns about the amount of spam and fake accounts on the site. Twitter estimates 5 percent of users are spam, but last week acknowledged that figure could be higher.

Musk wants to know what the exact percentage is before going ahead as he seeks to fight fake users and monetize the site.

Losing a quarter of its value in minutes, shares of Twitter jumped after Musk later tweeted that he was “still looking to buy.” But they still fell 9 percent to $ 41 – well below the $ 54.20 share price – a sign that investors are increasingly skeptical the deal will happen.

Neil Wilson, Markets analyst, said: “I’ve always felt that way [the] the deal was suspicious, and now I understand that it will not happen and may never happen. ”

Neil Campling, an analyst at Mirabaud, added: “Laughter! We’ve always said it can cut, run or change a melody at 11 a.m. 59 minutes 59 seconds on the clock. This is a farce.

Tesla shares fell 33 percent in the weeks after Musk first took a stake in Twitter and then launched a full-scale takeover bid. Investors were unhappy Musk used large portions of his shares in the electric car maker to help fund the deal.

He has sold Tesla shares for £ 7 billion and plans to take out further loans under his shares. Over the deal from the beginning hung question marks regarding funding.

As a result, some believe Mask’s last move was a ploy. Suzanne Streeter, an analyst at Hargreaves Lansdown, said: “There are questions about whether fake accounts are the real reason for this delay tactic.” The price tag of £ 35 billion is huge and it could be a strategy to get back the amount he is willing to pay to buy the platform. ”

Mask’s tweet can also cause him to be in hot water with U.S. regulators for the fact that he turned to Twitter to announce the delay rather than through regulations.

He already had problems with the U.S. Securities and Exchange Commission, which is checking his early disclosure on Twitter when he created the stake.

Musk revealed his 9.2 percent stake on Twitter on April 4, a delay of at least ten days since breaking the 5 percent threshold for disclosure of the stake.

And the court this week found that Mask’s tweets in 2018 that Tesla went private when he said funding was secured were inaccurate and ill-considered.


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