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• Twitter slides 8% during Musk’s remarks in Miami
• Billionaire said at least 20% of Twitter accounts are likely fake or spam
Elon Musk on Monday fueled speculation that he could seek to renegotiate his Twitter Inc (NYSE: TWTR) takeover arrangement, saying a possible deal at a lower price wouldn’t be “out of the question.”
Twitter shares on Monday tumbled nearly 8% to $37.51, below $39.31, the closing price of April 1, the last trading day before the billionaire disclosed his 9% stake in the social media company.
Investors have been dumping the stock on concern that Musk will abandon his plan to take over the microblogging platform for $44 billion, or $54.20 a share.
Last Monday, short-seller firm Hindenburg Research warned that Musk’s offer to take Twitter private could get repriced lower if the billionaire plans to walk away from the deal.
“Musk holds all the cards here,” the firm said in a report. “If Elon Musk’s bid for Twitter disappeared tomorrow, Twitter’s equity would fall by 50% from current levels. Consequently, we see a significant risk that the deal gets repriced lower.”
While the stock was already on the decline since the report was published, the selloff accelerated after the billionaire, on Friday, tweeted, “Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users.”
He later wrote that he’s “still committed to acquisition,” prompting Twitter Chair Bret Taylor to respond, “We are too.”
Musk, on Monday, further pressed on that front at a Miami tech conference, saying that his lower end of estimation indicates that fake users make up at least 20% of all Twitter accounts, and asked rhetorically if the number could be as high as 90%.
Picture Credit: Engadget
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