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World's richest man Elon Musk, who was all set to buy Twitter for $44 billion announced via a tweet that the same deal was put on “temporary hold”, wiping out $3.41 billion of investors' wealth.
The gist of the matter is that Twitter had reported earlier this month that less than 5% of monetizable accounts represent spam bots and fake accounts. Mr. Musk had made it clear that 'defeating' spambots was one of his primary goals when he announced the deal.
“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users.” Tweeted Mr. Musk.
He expressed his desire to authenticate all human users, and make the algorithm of Twitter open source. He also suggested certain ideas to improve the revenue generation of the microblogging site. This act brought down the share of the company as the stock witnessed a full gap down opening.
The stock was seeing some decline in recent days as it had been falling consistently for the past 5 trading sessions before closing on 12th May at $45.08 per share. The stock opened down 10.4% at $40.40 per share to reach a low of $40.01 per share, a price level it hadn't reached since late March.
Bulls managed to resist as they took the share to a high of $42.00 per share and managed to keep the candle green as the share closed at $40.72 per share, down 9.67% from yesterday's close & 29.79% down from the share's close at $58.00 per share a year ago.
Twitter is constantly in the news as criticism and favor of Mr. Musk's takeover continue. Recently, two executives at Twitter, Kayvon Beykpour & Bruce Falck, were asked to leave the company by company CEO Parag Agarwal. This is part of the cost-cutting initiatives announced by the CEO which also includes a hiring freeze, rescinding offers already put out, and reducing costs on traveling, consulting, marketing, etc.
Article by Aman Agarwal.
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