Elon Musk Takes 9.2% Stake in Twitter, Making Him Biggest Shareholder

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Elon Musk, the CEO of Tesla Inc, unveiled a 9.2 percent interest in Twitter Inc, worth about $3 billion, putting him as the microblogging site’s largest stakeholder and causing its stock to surge more than 20%, Reuters reports. Musk’s move comes just days after he tweeted that he was “considering” creating a new social media platform and questioned Twitter’s commitment to free expression.

Since joining Twitter in 2009, Musk has amassed over 80 million followers and has used the network to make various announcements, including dangling a Tesla go-private proposal that landed him in regulatory hot water.

He has recently been critical of the social media platform and its practices, claiming that the corporation is hurting democracy by not adhering to free-speech values.

“It does send a message to Twitter,” Thomas Hayes, managing member of Great Hill Capital LLC, said. “Having a big investment in the company will keep them on their toes, since that passive stake could very easily become an active stake.”

Musk, who is also one of the world’s wealthiest people, has been selling his Tesla stock since November, when he announced that he would sell 10% of his ownership in the electric carmaker. Since then, he has sold $16.4 billion worth of stock. Musk holds 73.5 million Twitter shares, according to a regulatory filing on Monday, which are held by the Elon Musk Revocable Trust, of which he is the sole trustee. According to Refinitiv statistics, Vanguard is Twitter’s second-largest shareholder, with an 8.79 percent holding.

In a client note, CFRA Research analyst Angelo Zino said, “Musk’s real stake is a relatively modest percentage of his fortune, and an all-out takeover should not be ruled out.” ” Elliott Management Corp, an activist investor, targeted Twitter in 2020, claiming that its then-CEO and co-founder, Jack Dorsey, was paying too little attention to Twitter while simultaneously running Square.

In November of last year, Dorsey, who owns more than 2% of Twitter, stood aside as CEO and chairman, handing over the reins to 10-year industry veteran Parag Agrawal.

Meanwhile, Musk and Dorsey have found some common ground by criticizing the so-called Web3, a nebulous notion for a decentralized utopian internet. Twitter’s stock was trading at $47.19 per share. They’ve down 38% in the last 12 months as of Friday’s close. 

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