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Why is Twitter Not Trading at 54.20?
Why is Twitter not trading at 54.20? Some speculate that the company is taking steps to shore up its balance sheet. They point to Elon Musk’s personal wealth, political views on Twitter, and ability to pay a $1 billion breakup fee. Perhaps, or maybe not, it is taking steps to ensure its own future. In the meantime, Twitter may just be doing what it needs to do to maintain the momentum of its rapid growth.
Elon Musk’s bid
Tesla CEO Elon Musk has signed a consent decree with the SEC, the government agency that regulates publicly traded companies. In it, Musk agreed not to make untrue statements or omit relevant facts when publicly speaking about his stock trading. Violation of the consent decree could result in fines or penalties. Read also : How to Log Out of Twitter on PC and Switch Back to a Different Account. Although Musk hasn’t been charged with violating any regulations, regulators are likely looking at how he built his stake in Twitter. He disclosed his stake in Twitter 11 days after the deadline, resulting in a shareholder lawsuit.
While the private equity firm Thoma Bravo has expressed interest in purchasing the company, it has not made a formal offer. That means Musk can use other methods to outmanoeuvre the Twitter board. Moreover, Twitter’s stock is up by 2 percent in the premarket before the opening bell on Friday. That’s because Twitter has already adopted a poison pill defense that would make it more expensive for outside investors to increase their stakes.
Elon Musk’s wealth
There is a big speculation about whether Twitter will accept Elon Musk’s $46.5 billion takeover bid. It’s important to remember that Twitter has several activist shareholders. If Musk gets the deal, the company will have to cough up cash to keep running. Read also : How to Add Emojis to Twitter. It’s not clear how Musk will meet his cash requirements. Musk is reportedly in a race to secure debt financing for his takeover bid. But he’s assured that the plan is serious.
There are two reasons. One is that Musk is willing to spend so much money on Twitter that it would make him the world’s richest person. His stake in Tesla is estimated to be $15 billion. Musk also wants Twitter to move towards a subscription business model and soften content moderation. In addition to Elon Musk’s wealth, the Twitter bid is likely to be a good one for individual investors. In April, individual investors poured $747 million into Twitter stock. That’s almost 10 times more than the average monthly purchase of the company in the year 2021.
Elon Musk’s political views on Twitter
Elon Musk has faced criticism for his fractious political comments on Twitter. The billionaire has said repeatedly that his goal in buying Twitter is to make it a place for “free speech. To see also : Who is the Number 1 Follower on Twitter?.” While the First Amendment protects free speech, both the right and left have a strong opinion on it. Musk’s comments on Twitter suggest that he means to make Twitter a more tolerant place for misinformation, personal harassment, and hate speech.
In recent months, Musk has been criticised for his partisan political views on Twitter. He has called himself a socialist and opposed labor unions. He has also advocated for centrism and a libertarian worldview. He has, however, publicly supported Andrew Yang in the Democratic presidential primary this year. It is unclear whether Musk will keep his political views to himself, but his political activism and stance on the environment are likely to keep the attention of his followers.
Elon Musk’s ability to pay $1 billion break-up fee
If you’re wondering how Elon Musk can possibly afford to pay $1 billion to acquire Twitter, you’re not alone. Twitter shareholders and investors have been on tenterhooks over the acquisition, and it’s easy to see why. This latest saga has distracted employees, with some deciding to leave, while others are being laid off. And while Twitter is unlikely to change hands, its turmoil could discourage advertisers. Additionally, too many engineers leaving the platform could hurt its quality. That’s why Twitter’s break-up fee could be well north of $1B.
The question is whether Musk’s $230 billion net worth allows him to pay a $1 billion break-up fee. After all, if he can afford such a fee, why would he want to? Twitter is reportedly looking for more than that, and Musk may not be willing to pay that amount. If he’s unwilling to pay this break-up fee, it could hurt Tesla’s reputation.
