Big setback for Tesla CEO! Twitter deal on hold, says Elon Musk
Tesla CEO Elon Musk said on Friday his $44-billion acquisition of Twitter Inc was temporarily on hold, citing pending details on spam and fake accounts.
"Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users," he said in a tweet.
Shares of Tesla and Twitter have tumbled this week as investors deal with the fallout and potential legal issues surrounding Tesla CEO Elon Musk and his $44 billion bid to buy the social media platform.
Of the two, Musk's electric vehicle company has fared worse, with its stock down almost 16% so far this week to $728. Twitter shares fell 9.5% for the week, closing Thursday at $45.08. Both stocks have taken a bigger hit than the S&P 500, which is down 4.7% for the week.
Along with malaise in the broader markets, investors have had to weigh legal troubles for Musk, as well as the possibility that his acquisition of Twitter could be a distraction from running the world's most valuable automaker.
The Wall Street Journal reported Wednesday that U.S. securities regulators are investigating Musk's tardy disclosure that he had bought more than 5% of Twitter shares. Musk now owns more than 9% of the San Francisco company.
The SEC wouldn't comment, and a message was left for Musk's lawyer.
A lawsuit filed last month by some Twitter shareholders alleges that Musk's stake hit 5% on March 14, so he should have filed forms with the SEC disclosing that by March 24. Instead, Musk didn't make the required disclosure until April 4, hurting less-wealthy investors who sold Twitter stock in the nearly two weeks before he disclosed his stake and drove up the price, the lawsuit alleges.
Also Wednesday, a federal judge in California handed a
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