Elon Musk has become Twitter’s largest shareholder after buying a 9.2 per cent stake in the social media company.
The world’s richest man bought nearly 73.5 million shares, a document filed with the US Securities and Exchange Commission shows.
It means the Tesla co-founder has more than quadruple the shares of Twitter’s founder Jack Dorsey, who owns 2.25 per cent.
His passive stake in the company is valued at up to $2.9billion based on the stock’s Friday close, and the estimated cost of the deal was $2.4billion, according to the stock price on March 14 when he bought the shares.
The news prompted Twitter’s stock to soar by more than 26 per cent in pre-market trade before Wall Street opened on Monday.
Elon Musk has become Twitter’s largest shareholder, with a 9.2 per cent stake in the social media company
The news prompted Twitter’s stock to soar by more than 26 per cent in pre-market trade before Wall Street opened on Monday
Shares of other social media firms, including Meta Platforms and Snapchat owner Snap Inc, were also trading higher.
Musk’s stake in Twitter is considered a passive investment, which means he is a long-term investor that’s looking to minimize his buying and selling of the shares.
‘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,’ Dan Ives of WedBush Securities wrote in a client note early Monday.
On the same day as the filing of the SEC document, Musk challenged Vladimir Putin to a fight on Twitter.
The mogul has been raising questions about the ability to communicate freely on Twitter, tweeting last month about free speech and the social media platform.
The world’s richest man bought nearly 73.5 million shares, a document filed with the US Securities and Exchange Commission shows
On the same day as the filing of the SEC document, Musk challenged Vladimir Putin to a fight on Twitter
The mogul has been raising questions about the ability to communicate freely on Twitter
‘Free speech is essential to a functioning democracy. Do you believe Twitter rigorously adheres to this principle?’ he tweeted.
In a separate tweet, Musk said that he was ‘giving serious thought’ to creating a new social media platform.
Musk was responding to a Twitter user’s question on whether he would consider building a social media platform consisting of an open source algorithm and one that would prioritize free speech and where propaganda was minimal.
Also last month, Musk asked a federal judge to nullify a subpoena from securities regulators and throw out a 2018 court agreement in which Musk had to have someone pre-approve his posts on Twitter.
US securities regulators said they had legal authority to subpoena Tesla and Musk about his tweets, and that Musk’s move to throw out a 2018 court agreement that his tweets be pre-approved is not valid.
Musk’s revelation about his stake in Twitter shares comes two days after Tesla Inc. posted lackluster first-quarter production numbers.
It means the Tesla co-founder has more than quadruple the shares of Twitter’s founder Jack Dorsey (pictured), who owns 2.25 per cent
While the company delivered 310,000 vehicles in the period, the figure was slightly below expectations.
The entrepreneur is a frequent user of Twitter although his posts have occasionally landed him in hot water.
He has over 80 million followers on the site since joining in 2009 and has used the platform to make several announcements, including teasing a go-private deal for Tesla that landed him in regulatory scrutiny.
Musk and Dorsey have had some common ground in terms of dismissing the so-called Web3, a vague term for a utopian version of the internet that is decentralized.
Musk is also the founder and CEO of SpaceX, and leads brain-chip startup Neuralink and infrastructure firm The Boring Company.
Dorsey resigned as Twitter CEO in November after 15 years at the helm.
He remains remains the CEO of Square Inc, the hugely successful financial payments company that he co-founded in 2010, and holds shares in Twitter.