Elon Musk Snapped Up a 9.2% Stake in Twitter

Mega-entrepreneur Elon Musk and Twitter had a bit of history before Musk’s purchase of 9.2% of the company’s stock March 14. Musk filed a Schedule 13G form with the Securities and Exchange Commission March 14, declaring his purchase of 73,486,938 Twitter shares. The filing did not disclose the motive behind the transaction. Investors must disclose purchases of more than 5% of a company’s shares to the SEC, but stakes of under 10% are considered to be passive. “I think he intends to go active and force change at Twitter," Wedbush Securities tech analyst Dan Ives told CNN Business. "This is a shot across the bow at Twitter's board and management team to start discussions.” YouTube Tests a Dedicated Podcast Homepage Ives also noted that Musk's prospects of starting a new social platform from scratch were not realistic, and trying to force changes at Twitter was a more likely way for Musk to achieve his goals. Twitter had not responded to a request for comment at the time of this post, but its stock shot up by more than 25% Monday, compared with its Friday closing price of $39.31 per share. Musk got into hot water with the SEC in 2018 for tweeting about a possible buyout of his company, electric vehicle manufacturer Tesla. The SEC chided Tesla in letters sent in 2019 and 2020, saying that the company did not abide by the terms of the settlement of the 2018 issue, and failed to oversee Musk’s tweets on solar roof production and the company’s stock price. On March 26, 12 days after his Twitter share purchase, Musk responded to a tweet from machine learning engineer Pranay Pathole asking whether he would consider building a new social media platform with an open-source algorithm and priority on free speech with, “Am giving serious thought to this.” He also tweeted that day, “Given that Twitter serves as the de facto public town square, failing to adhere to free-speech principles fundamentally undermines democracy. What should be done?” “Musk is known for bringing innovation and disruption to everything he touches. His criticism of Twitter around principles of free speech points to the type of vision he could bring to the platform," Forrester principal analyst Kelsey Chickering told Adweek. She pointed to a recent NYU study, which found that publishers known for sharing misinformation got six times the engagement on Facebook during the run-up to the 2020 U.S. presidential election that those considered to be trustworthy, adding, "In an age wrought with misinformation and disinformation, the parameters around free speech become murky." In addition to Tesla, Musk is also founder, CEO and chief engineer at SpaceX, founder of The Boring Company and co-founder of Neuralink and OpenAI. Musk has 80.2 million followers on Twitter.

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Elon Musk Snapped Up a 9.2% Stake in Twitter, Spurring Share Price Hike

The entrepreneur criticized the social network’s failure 'to adhere to free speech principles' just 12 days later

David Cohen

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David Cohen