Elon Musk becomes Twitter’s largest shareholder

Elon Musk acquired a 9.2 percent stake in Twitter to become the platform’s biggest shareholder, a week after hinting it could shake up the social media industry.

Shares of Twitter rose about 26 percent in premarket trading after the Musk purchase was revealed in a regulatory filing on Monday. The stake is worth about $2.89 billion, according to market close Friday.

Musk, 50, surveyed his more than 80 million Twitter followers last month, asking if the company adheres to the principles of freedom of expression. After more than 70 percent said no, he asked if a new platform was needed and said he was seriously thinking about starting his own.

Musk has been one of the biggest personalities on Twitter and has regularly struggled on the platform. Tesla’s chief executive is currently seeking to get out of a 2018 settlement with the US Securities and Exchange Commission that established controls related to his tweets about the electric car maker.

The announcement will be another major test for Twitter’s new CEO, Parag Agrawal, who replaced Jack Dorsey after he unexpectedly resigned in November. Agrawal made a commitment to increase accountability, make decisions faster, and improve product execution. The company established ambitious goals for growthincluding increasing annual revenue to $7.5 billion and reaching 315 million daily users by the end of 2023.

Musk posted a cryptic meme in December after Twitter announced that Agrawal would replace Dorsey as Twitter CEO. It depicted Agrawal as Soviet dictator Joseph Stalin and Dorsey as Soviet secret police chief Nikolai Yezhov being pushed into the water.

“Looks like Elon has his eyes on Twitter”Wedbush analyst Dan Ives said in a research note, adding that the involvement could lead to a “more aggressive ownership role.”

Twitter is particularly vulnerable to external pressure because, unlike Google, Facebook, Amazon and Snap, the company’s founders have no special voting control over its future. The company has just recovered from activist pressure from Elliot Management that began in 2020 and led Dorsey, who was serving his second term as Twitter CEO, to establish a succession plan.

It’s unclear what Musk plans with his involvement. The SEC filing shows that the date of the event that triggered the disclosure was March 14. The type of form used often indicates that the investor does not seek to acquire control of a company or influence who controls it.

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