What noise. This Friday, the billionaire Elon Musk announced to suspend the takeover of Twitter… before changing his mind. “The Twitter agreement is temporarily suspended pending details supporting the calculation that spam-fake accounts actually represent less than 5% of users”, he wrote on his account on the social network at the start of the day. Before, a few hours later, ensure be “always engaged” to buy the business from the blue bird.
Statements with serious consequences. Twitter’s stock, which had plunged after the suspension was announced, limited its losses somewhat but lost about 11% in electronic trading before the opening of Wall Street.
He further shared an article from Reuters citing the social network’s estimates, which appeared in a Monday filing, that fake accounts and spam accounted for less than 5% of its 229 million monetizable daily active users over the past trimester. In his plans for the network, the boss of Tesla had pledged to “defeat spambots”, authenticate all humans and make its algorithms open source. Libertarian, the entrepreneur wanted to make “free speech platform”.
A takeover proposal made a month ago
Elon Musk has not yet specified the reasons for this suspension. One of the assumptions made would be that this estimate of fake accounts and spam could lead to a revision of the valuation of Twitter, on which the billionaire had relied to propose his takeover offer at 44 billion dollars on April 13. Indeed, with 5% of “non-real” accounts, the number of monetizable users could be lower than forecast, which could lead the billionaire to revise its offer downwards.
In the company’s report, Twitter indicates that its calculation, in order to obtain this estimate, was done by taking “the average of fake or spam accounts in the samples during each monthly analysis period of the quarter”. A potentially biased methodology that could bring the percentage from 5% to “not accurately representing the actual number of these accounts”. The real figure could be, she says, “superior”.
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
As a reminder, the founder of SpaceX, who had recently acquired 9.2% of the capital of Twitter, had proposed, on April 13, to buy the entire company at a unit price of 54.20 dollars per share and to exit the Wall Street business. The offer, initially resisted by the company’s board of directors, was finally accepted two weeks later. However, doubts had been expressed as to the businessman’s ability to raise the requested sum.
The group’s action plunged about 20% after this announcement in electronic trading before the opening of Wall Street. Tesla shares had gained nearly 5% before the opening of Wall Street.
Update at 2:40 p.m. with the precision of Elon Musk