Tech

Twitter shares fell after Elon Musk canceled a $44 billion deal

In this photo illustration, Elon Musk’s Twitter account is seen on a smartphone screen with the Twitter logo in the background.

Paulo Hanchar | Lightrocket | Getty Images

Shares of Twitter fell sharply in early premarket trading on Monday after Elon Musk said he was trying to stop a $44 billion takeover of the company.

The company’s shares fell nearly 9% in premarket U.S. trading before paring some losses to close 7% lower. Meanwhile, Tesla shares rose about 1% in premarket trading.

On Friday, Musk’s lawyer told Twitter’s board that he wanted to cancel the deal. The billionaire has disputed the number of bots and fake accounts on Twitter and says the company is not telling the truth about how much activity on the service is genuine.

Twitter, on the other hand, says it gave Musk the information he needed to evaluate the claim that spam accounts make up only 5% of monetized daily active users, including its so-called “firehose,” an unfiltered, real-time stream . of daily tweets.

Brett Taylor, chairman of Twitter’s board of directors, said the company would file lawsuits in Delaware’s chancellor court to enforce the settlement.

Musk responded on Monday by posting a meme mocking Twitter management for the failed deal. The meme shows images of Musk laughing more aggressively with each sentence.

“They said I can’t buy Twitter. Then they will not disclose information about the bot. Now they want to force me to buy Twitter through the court. Now they have to disclose information about the bot in court,” the meme reads.

Twitter was not immediately available for comment when contacted by CNBC.

Musk is one of the most popular users on Twitter, with over 100 million followers. He used the social media site for everything from corporate communications for his companies to criticizing the very platform he previously wanted to buy.

Richard Windsor, founder of research firm Radio Free Mobile, said he is not a shareholder in Twitter, but if he was, he would sell now.

“There’s still a gap between the fundamentals and the share price,” Windsor told CNBC’s “Squawk Box Europe” on Monday.

“If you look at where the tech sector has gone in the last couple of months, you can put Twitter’s valuation somewhere between $13 [billion] to $15 billion, which is about 50% lower than even today’s share price.’

Twitter shares fell after Elon Musk canceled a $44 billion deal

Source link Twitter shares fell after Elon Musk canceled a $44 billion deal

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