The historic $44 billion Twitter-acquiring deal has been put on hold and Tesla CEO Elon Musk, the prospective buyer, made the announcement. He cited details pending on the microblogging site’s claim that there are less than 5% fake/spam accounts available of the total number of users.
“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” Musk tweeted. He also shared a Reuters story on Twitter’s claim.
Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of usershttps://t.co/Y2t0QMuuyn
— Elon Musk (@elonmusk) May 13, 2022
Reason for temporary hold
One of Musk’s primary objectives after formally acquiring the site is to get rid of “spambots” from Twitter. He wants to be sure of the number of fake/spam accounts available out of the total monetisable active users.
Twitter’s claim, reaction after Musk’s announcement
Earlier this month, Twitter claimed that there are less than 5% fake/spam accounts available on the site out of the total monetisable active users. The microblogging site further claimed that it was facing several risks before Musk’s deal is closed including advertisement spending.
Right after the announcement, a straight 20% drop was noticed in Twitter shares in the premarket trading. Without even having many details on the hold, Musk’s tweet caused a ruckus in the investment and tech industries.
Musk initially wanted to buy Twitter with a loan from Morgan Stanley, however, he later filed that he has received equity commitments from Andreessen Horowitz, Sequoia Capital, Larry Ellison among others.