Twitter stock fell after Elon Musk said deal is pending


Elon Musk said his deal to buy Twitter was pending, raising questions about the acquisition.


picture:

David Paul Morris/Bloomberg News

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Twitter company

TWTR -8.71%

Dropped at midday Friday after

Elon Musk

He said his deal to buy a social media company was hanging.

Twitter shares fell 6.9% to $41.99, on track to close at their lowest level since early April, just ahead of Mr. Musk. Surprise revealed 9% stake In the company.

Mr. Musk, CEO of

Tesla Corporation.

TSLA 7.95%

Last month Make a deal to buy Twitter And consider it special, capping a volatile month for the social media company and its stocks. But on Friday morning, he wrote on Twitter, “Twitter deal temporarily on hold, pending account details that spam/fake accounts already account for less than 5% of users.” He linked a May 2 Reuters report to a recent financial file on Twitter containing these statistics.

Twitter shares fell as much as 26% in premarket trading on Friday, to $33.51, according to Dow Jones Market data.

Later Friday morning, Mr. Musk added on Twitter that he “remains committed” to the acquisition. This helped Twitter cut its losses.

Still, Twitter Stocks are trading now About 23% below the transaction price of $54.20 per share. The company’s shares have already been dropping recently, reflecting investor concerns about the prospects for the deal. Like many tech stocks, Twitter has been hit hard lately by a massive sell-off of riskier assets in the market.

Tesla shares jumped 5.8% at midday Friday.

Tesla shares have fallen since Twitter accepted Mr Musk’s takeover offer. Mr. Musk plans to borrow against his stake in Tesla to fund the deal. Tesla investors are also concerned that owning Twitter could distract Mr Musk from managing Tesla.

Elon Musk has established close ties with Beijing to build Tesla’s business in China. Now that it has bought Twitter and is focusing on free speech, The Wall Street Journal looks at how China is using the social media platform to promote its views, and why it raises such concern. Image caption: Sharon Shee

Write to Caitlin McCabe at caitlin.mccabe@wsj.com

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