Uncertainty Musk Twitter’s acquisition will be closed

Uncertainty Musk Twitter’s acquisition will be closed

Uncertainty Musk Twitter’s acquisition will be closed
Advertisement

Twitter shares rose on Thursday after the business reported mixed profits, but they remained below the price in the firm’s takeover deal with Elon Musk due to uncertainty over whether the transaction will be completed.

Near 1850 GMT, the microblogging company’s stock was trading at $49.18, up 1.1 percent from Wednesday but still significantly below the $54.20 price agreed upon between Twitter and Musk.

According to Scott Kessler, an analyst at Third Bridge, the difference between Twitter’s stock price and that of the deal reflects unanswered doubts about the acquisition transaction, which is anticipated to finalize later this year.

“What we’ve seen in the last month came together so swiftly and unexpectedly that many are prepared for the potential that the transaction would not complete.”

Twitter stated in its earnings report on Thursday that the Musk transaction “is expected to conclude in 2022 if customary closing criteria” are met.

Advertisement

However, several notable voices have raised misgivings about the deal’s completion for a number of reasons, including concerns about funding and Musk’s ability to operate Tesla. Musk is also a corporate iconoclast known for his unpredictability.

Musk’s funding strategy comprises a $13 billion lending facility from a consortium led by Morgan Stanley, a second $12.5 billion margin loan from the same bank, and $21 billion from Musk’s own fortune.

However, Musk has not stated how he intends to fund his half. While Forbes lists Musk as the world’s richest person, his fortune is said to be mostly derived from Tesla shares, implying that he would have to sell billions of dollars of Tesla stock to pay the package.

The deal’s breakup cost is $1 billion.

Following a one-time gain from a divestment, the micro-blogging platform announced earnings of $513.3 million in the first quarter of 2022, more than seven times the year-ago figure. Revenues increased by 16 percent to $1.2 billion, slightly less than the $1.22 billion predicted by experts.

Twitter canceled its quarterly results conference call with analysts in the aftermath of the purchase.

Advertisement
Advertisement
Read More News On

Catch all the International News, Breaking News Event and Latest News Updates on The BOL News


Download The BOL News App to get the Daily News Update & Follow us on Google News.


End of Article

Next Story