Elon Musk during an event at the SpaceX headquarters in Hawthorne, California, USA, on Thursday, October 10, 2019.
Bloomberg / Getty
Elon Musk announced on Friday that his Twitter deal would be suspended until further notice about the number of fake accounts on the social media platform.
In a follow-up tweet about two hours later, Musk added that he was “still committed to the acquisition.”
Twitter’s stock has fallen 18% in premarket trading since the initial announcement, but has eased some losses since the second tweet. A spokesman for the social media company did not immediately respond to a request for comment by CNBC.
Tesla CEO Musk announced last month that he wanted to buy Twitter for 44 44 billion, and he had previously tweeted that one of his top priorities would be to remove “spam bots” from the platform.
Even before Friday’s announcement, the company’s market value fell below the offer price of $ 9 billion due to contract concerns.
Musk, who is expected to become Twitter’s interim CEO if the deal goes ahead, will have to pay a $ 1 billion breakup fee if he wants to step down. Musk is valued at more than 20 220 billion.
Twitter estimated in a filing earlier this month that less than 5% of its monetized daily active users had bots or spam accounts in the first quarter.
Musk, who is the richest man in the world on paper, now wants to confirm the deal with the company before continuing the deal, which is being funded in part by Oracle co-founder Larry Ellison and venture capital firm Andresen Horowitz.
The San Francisco-based social media company said in a filing that it had 229 million users in the first quarter who were advertised.
On Tuesday, Musk said he would lift the Twitter ban on former President Donald Trump if he accepted the agency.
“Permanent bans should be extremely rare and should really be reserved for bots, or scandalous, spam accounts … I don’t think it was right to ban Donald Trump,” Musk told FT Live’s Future of the Car conference. “I think it was a mistake, because it isolated a large part of the country and in the end was not the voice of Donald Trump.”
Earlier this month, Bill Gates warned that the mask could make Twitter “worse.” Speaking at the Wall Street Journal CEO Summit, Gates said it was unclear how Mask would change Twitter if he took ownership, but also expressed concern about the spread of misinformation on social media platforms.
Gates questioned what Musk’s goal was with Twitter and whether his drive to promote freedom of speech was wise. “What are its goals for what it ends up with? [and] Strange conspiracy theory? Will he share that goal? ”Gates said.
Before Musk made his bid to buy Twitter directly, he failed to disclose more than 9% stake in the company within the mandatory 10-day window of the SEC.
The report states that the Federal Trade Commission is investigating the timing of Musk’s release. Bloomberg later said the FTC was separately reviewing the acquisition itself, although many experts did not expect the deal to raise concerns about mistrust.
The FTC did not disclose the ongoing investigation, and an FTC spokesman declined to comment.
Tesla shares rose nearly 7% in premarket trading on Friday.
Susannah Streeter, a senior investment and market analyst at Hargreaves Lansdowne, says some may question whether the real reason behind the delay strategy is a fake account.
“The $ 44 billion value tag is huge, and could be a strategy to back away from the amount he is willing to pay to acquire the platform,” he said in a statement.
– Additional reporting by CNBC’s Lauren Feiner.