Elon Musk has announced his $44billion acquisition of Twitter is temporarily on hold pending details about the number of spam and bot accounts on the social media platform.
The company said earlier this month that false or spam accounts represented fewer than 5 per cent of its 229million users during the first quarter.
But Musk is now pausing his mammoth takeover demanding further information about the figures. Twitter’s board approved the purchase but it still not has been completely finalized.
Shares of the social media company fell 25 per cent in premarket trading this morning, continuing a massive downward trend since his takeover bid was announced on April 25.
The world’s richest man said on Twitter today: ‘Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users
He linked a Reuters report from May 2 stating Twitter’s calculation that bots were only a small percentage of the site’s users.
Musk had said that one of his priorities would be to remove ‘spam bots’ from the platform.
It is not clear what the legal effect of his notice was.
Prices have been plummeting ever since Musk’s buyout deal was agreed by the tech behemoth.
The deal to announce the Tesla CEO was taking the company private was announced on April 25, when stocks closed at $51.70.
Ever since, prices have been falling lower and lower to their latest close on Thursday at $45.08, a slump of nearly 13 per cent meaning the company is now worth $9billion less than the amount Musk stumped up for it.
Twitter did not immediately respond to a request for comment.
This week, a US firm which bets against company share prices said Musk could submit a lower bid for Twitter due to the slump in stocks and a poor financial performance.
Ever since, prices have been falling lower and lower to their latest close on Thursday at $45.08, a slump of nearly 13 per cent meaning the company is now worth $9billion less than the amount Musk stumped up for it.
Twitter did not immediately respond to a request for comment.
This week, a US firm which bets against company share prices said Musk could submit a lower bid for Twitter due to the slump in stocks and a poor financial performance.
Ever since, prices have been falling lower and lower to their latest close on Thursday at $45.08, a slump of nearly 13 per cent meaning the company is now worth $9billion less than the amount Musk stumped up for it.
Twitter did not immediately respond to a request for comment.
This week, a US firm which bets against company share prices said Musk could submit a lower bid for Twitter due to the slump in stocks and a poor financial performance.
Short-selling firm Hindenberg Research said there is a ‘significant chance’ the entrepreneur will try to pay less than the agreed $54.20 per share price which was accepted by the Twitter board.
The sharp drop in the Nasdaq stock market since the deal was struck implies a far lower value for Twitter, whose value is being propped up by the takeover bid.
In a document published Monday, the company said: ‘We are supportive of Musk’s efforts to take Twitter private and see a significant chance the deal will close at a lower price.’
They added that if Musk decides to walk away, Twitter shares could fall by as much as 50 per cent.
But the SpaceX founder could have to pay $1 billion just to walk away from the deal in a breakup fee.
Twitter had said it faced several risks until the deal with Musk is closed, including whether advertisers would continue to spend on Twitter.
The announcement is another twist amid signs of internal turmoil over his planned buyout of Twitter, including that the social media company fired two of its top managers Thursday.
Head of consumer product Kayvon Beykpour and general manager for revenue Bruce Falck were unceremoniously axed.
The truth is that this isn’t how and when I imagined leaving Twitter, and this wasn’t my decision. [CEO] Parag [Agrawal] asked me to leave after letting me know that he wants to take the team in a different direction,’ Beykpour said.
Musk also suffered from the huge Cryptocurrency crash this week.
He is one of four so-called ‘Crypto Bros’ whose combined gigantic wealth, which for years has helped prop up the online currency market, has now taken the most colossal hit despite believing crypto would be a safe haven during the pandemic.
But more than $20billion has been wiped off the cryptocurrency market yesterday alone.
Tesla, which took a $1.5billion gamble on Bitcoin last February, has already seen that investment fall flat with its estimated value already $300million lower than it was 15 months ago.
Yesterday, it was also revealed the Tesla CEO’s purchase was being investigated by US regulators after he delayed reporting the buy – and thus failed to provide sufficient warning that a takeover bid was looming.
The 50-year-old’s first move towards buying Twitter was his purchase of a 9.2 percent stake in the tech company in mid February.
But he did not disclose his purchase to the Securities and Exchange Commission (SEC) until at least 10 days later, on April 4.
Any investor who crosses a 5 percent stake must file a form with the SEC within 10 days. It serves as an early sign to stakeholders that a big investor could seek to control the company.
Musk’s April 4 filing also characterized his stake as passive, meaning he did not plan to take over Twitter or influence its management or business.
The next day, however, he was offered a position on Twitter’s board, and a couple of weeks later, the world’s richest man had clinched a $44billion deal to buy the social media giant.
The SEC investigation was first reported on Wednesday by The Wall Street Journal.
This week, Musk has also sparked fierce debate after saying he would allow Donald Trump back on Twitter if and when he takes the reins, in line with his previous declarations that he planned to err on the side of free speech rather than bans and censorship.
The truth is that this isn’t how and when I imagined leaving Twitter, and this wasn’t my decision. [CEO] Parag [Agrawal] asked me to leave after letting me know that he wants to take the team in a different direction,’ Beykpour said.
Musk also suffered from the huge Cryptocurrency crash this week.
He is one of four so-called ‘Crypto Bros’ whose combined gigantic wealth, which for years has helped prop up the online currency market, has now taken the most colossal hit despite believing crypto would be a safe haven during the pandemic.
But more than $20billion has been wiped off the cryptocurrency market yesterday alone.
Tesla, which took a $1.5billion gamble on Bitcoin last February, has already seen that investment fall flat with its estimated value already $300million lower than it was 15 months ago.
Yesterday, it was also revealed the Tesla CEO’s purchase was being investigated by US regulators after he delayed reporting the buy – and thus failed to provide sufficient warning that a takeover bid was looming.
The 50-year-old’s first move towards buying Twitter was his purchase of a 9.2 percent stake in the tech company in mid February.
But he did not disclose his purchase to the Securities and Exchange Commission (SEC) until at least 10 days later, on April 4.
Any investor who crosses a 5 percent stake must file a form with the SEC within 10 days. It serves as an early sign to stakeholders that a big investor could seek to control the company.
Musk’s April 4 filing also characterized his stake as passive, meaning he did not plan to take over Twitter or influence its management or business.
The next day, however, he was offered a position on Twitter’s board, and a couple of weeks later, the world’s richest man had clinched a $44billion deal to buy the social media giant.
The SEC investigation was first reported on Wednesday by The Wall Street Journal.
This week, Musk has also sparked fierce debate after saying he would allow Donald Trump back on Twitter if and when he takes the reins, in line with his previous declarations that he planned to err on the side of free speech rather than bans and censorship.
The truth is that this isn’t how and when I imagined leaving Twitter, and this wasn’t my decision. [CEO] Parag [Agrawal] asked me to leave after letting me know that he wants to take the team in a different direction,’ Beykpour said.
Musk also suffered from the huge Cryptocurrency crash this week.
He is one of four so-called ‘Crypto Bros’ whose combined gigantic wealth, which for years has helped prop up the online currency market, has now taken the most colossal hit despite believing crypto would be a safe haven during the pandemic.
But more than $20billion has been wiped off the cryptocurrency market yesterday alone.
Tesla, which took a $1.5billion gamble on Bitcoin last February, has already seen that investment fall flat with its estimated value already $300million lower than it was 15 months ago.
Yesterday, it was also revealed the Tesla CEO’s purchase was being investigated by US regulators after he delayed reporting the buy – and thus failed to provide sufficient warning that a takeover bid was looming.
The 50-year-old’s first move towards buying Twitter was his purchase of a 9.2 percent stake in the tech company in mid February.
But he did not disclose his purchase to the Securities and Exchange Commission (SEC) until at least 10 days later, on April 4.
Any investor who crosses a 5 percent stake must file a form with the SEC within 10 days. It serves as an early sign to stakeholders that a big investor could seek to control the company.
Musk’s April 4 filing also characterized his stake as passive, meaning he did not plan to take over Twitter or influence its management or business.
The next day, however, he was offered a position on Twitter’s board, and a couple of weeks later, the world’s richest man had clinched a $44billion deal to buy the social media giant.
The SEC investigation was first reported on Wednesday by The Wall Street Journal.
This week, Musk has also sparked fierce debate after saying he would allow Donald Trump back on Twitter if and when he takes the reins, in line with his previous declarations that he planned to err on the side of free speech rather than bans and censorship.