Elon Musk Buys $2.9Bn Stake in Twitter To Become Biggest Shareholder

Elon Musk Buys $2.9Bn Stake in Twitter To Become Biggest Shareholder

By Mark Sweney and Rupert Neate

The billionaire Elon Musk has taken an almost $3bn (£2.3bn) stake in Twitter to become the social media platform’s largest shareholder.

The world’s richest man, who has a penchant for eccentric behaviour frequently involving tweets, has built a 9.2% stake in Twitter, according to filings made to the US Securities and Exchange Commission (SEC) on Monday.

The boss of Tesla and SpaceX, who with more than 80 million followers ranks in the global top 10 of the most popular users on the microblogging site, paid $2.89bn for the stake at Twitter’s closing share price on Friday.

The company’s shares soared by more than a quarter in pre-market trading on the back of the news, adding about $8bn to its $31.5bn value, before easing back to 21% up in early trading. After the stock price jump Musk’s shares are now worth more than $3.5bn.

Musk has been highly critical of Twitter and only last week said he was “giving serious thought” to building his own social media platform after questioning whether it was adequately supporting free speech. He now holds a stake more than four times the 2.25% holding of the Twitter co-founder Jack Dorsey.

Analysts believe the shareholding taken by Musk could eventually result in the 50-year-old taking an active interest in the microblogging site that could lead to a buyout.

“We would expect this passive stake as just the start of broader conversations with the Twitter board/management that could ultimately lead to an active stake and a potential more aggressive ownership role of Twitter,” said Dan Ives, an analyst at Wedbush Securities.

Musk, whose personal fortune is estimated at $289bn – almost $100bn more than the world’s next richest person, the Amazon founder, Jeff Bezos – has often found himself in trouble for tweeting contentious remarks.

The Tesla boss’s many questionable Twitter moments include calling Vernon Unsworth, a diver who helped rescue a team of young football players stuck in a flooded cave in Thailand, “pedo guy” after he criticised Musk’s plan to save them with a submarine.

Musk eventually deleted the tweets and apologised to Unsworth, who sued for $190m in damages for the tweets. The jury found the Tesla boss did not defame Unsworth, and after the verdict Musk told reporters in the hallway of the courtroom: “My faith in humanity is restored.”

Last year, Tesla posted a job advertisement for a customer support specialist with responsibilities including handling complaints made against the South African-born American entrepreneur on social media.

In February, Musk tweeted a meme comparing the Canadian prime minister, Justin Trudeau, to Adolf Hitler, which he deleted after it attracted widespread criticism. In December, he tweeted a meme showing the face of Parag Agrawal, Twitter’s new chief executive, over that of the former Russian dictator Joseph Stalin.

Musk has also found himself in trouble with the US financial markets regulator, the SEC, for posting tweets that have had significant ramifications for the companies he runs.

In 2018, he posted that he had “secured” funding to take Tesla private, a move that resulted in the SEC requiring Musk to get pre-approval for certain public communications relating to the electric car company’s share price. Musk settled with the SEC, paying a $20m fine and stepping down as Tesla’s chairman, while saying it was “harassment” and an “unjustified action”.

While he was under investigation by the SEC he smoked marijuana on a live web show, which resulted in a 6% fall in Tesla’s share price, and the departure of two of its senior executives.

He angered the SEC again last year when he asked his Twitter followers if he should sell 10% of his stake in Tesla – which resulted in a sharp fall in the company’s share price – leading to the US regulator issuing a subpoena to see if Musk was complying with its previous settlement.

Musk met his on-off partner Grimes, real name Claire Boucher, on Twitter. In 2020, he tweeted that the couple’s newborn son would rather cryptically be called X Æ A-12. Grimes later explained the name in a social media post. The couple had a second child, a girl named Exa Dark Sideræl Musk, via surrogate in December.

In another moment of eccentricity, last year Musk changed his official job title at Tesla to “technoking” while the company’s financial chief was rebranded as “master of coin”, a nod to Tesla’s multibillion investments in bitcoin.

Original Source: https://www.theguardian.com/technology/2022/apr/04/elon-musk-buys-stake-twitter-share-tesla-spacex