1 of 4 | The Twitter logo is seen on a display at the New York Stock Exchange in New York City on April 25. Shares of the company declined on Monday over Elon Musk's attempt to back out of an agreement to buy the social platform. File Photo courtesy Tesla/UPI |
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July 11 (UPI) -- The value of public Twitter stock sank at the start of trading on Monday after the first opening bell on Wall Street since billionaire Elon Musk said he's backing out of an agreement to buy the social platform.
Shares of Twitter had fallen by about 9.5% by early Monday afternoon on the New York Stock Exchange, after they declined by about 5% in premarket trading. By 2:30 p.m. EDT, shares were trading for $33.36. Shares peaked at $51.70 in April after Twitter's board agreed to Musk's buyout offer of $44 million.
The downturn was expected after Musk announced on Friday that he wanted out of the Twitter deal, which he'd pursued for months.
The deal was agreed to in April, but the first sign of trouble came in May when Musk said the deal was on hold while the company determined how many of its daily monetizable users were phony or spam accounts.
That same issue, Musk said, is the reason he's abandoning the deal.
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Musk said previously that his intention was to turn Twitter into a more efficient and less-restrictive platform for speech, which was a possible indicator of why he was willing to let banned former President
Donald Trump return. File Photo by Joe Marino/UPI
In a letter to Twitter's top legal officer, which was included in a filing with the Securities and Exchange Commission, Musk said that Twitter officials have "not complied with contractual obligations" to assess the number of phony accounts.
"Twitter has failed or refused to provide this information," an attorney for Musk wrote in the letter.
Musk's attempt to buy Twitter caused significant controversy -- especially in May when the billionaire owner of Tesla and SpaceX said that he planned to allow former President Donald Trump back on the platform. Trump was banned two days after the Jan. 6, 2021, attack at the U.S. Capitol for inciting violence.
Musk, 51, was a member of two of Trump's business advisory councils when he was president, although he ultimately departed both in 2017 over Trump's decision to withdraw the United States from the Paris Climate Agreement.
On Monday, Musk mocked Twitter in two tweets. The first was a meme showing various facial expressions by Musk laughing at Twitter's failing to disclose the number of "bot" accounts. The second was a photo of meme-popular actor and martial arts expert Chuck Norris sitting at a chess board. Musk's caption read simply, "Checkmate."
Twitter has rejected Musk's claim that it has refused to provide information about the phony accounts -- and says it will attempt to force Musk to abide by the agreement in court.
Musk's is one of the most-followed accounts on Twitter, with nearly 101 million followers. Speculation increased about a possible deal for Musk to buy Twitter early this year when he began buying large blocks of Twitter stock.
Musk said previously that his intention was to turn Twitter into a more efficient and less-restrictive platform for speech, which was a possible indicator of why he was willing to let Trump return.
According to Forbes, Musk is the world's richest person -- with a net worth of $238 billion.
