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Twitter shares drop after Elon Musk terminates acquisition deal

FILE – Tesla and SpaceX Chief Executive Officer Elon Musk speaks at the SATELLITE Conference and Exhibition in Washington, Monday, March 9, 2020. (AP Photo/Susan Walsh, File)

Shares of Twitter on Monday had dropped in value to 37 percent below the $44 billion price Elon Musk first offered the company when he sought to purchase it.

The Tesla founder told securities regulators on Friday that he would terminate his deal with Twitter, resulting in a rapid drop of nearly 10 percent in the first day of trading after Musk’s announcement.

Shares currently stand at $33.31 each, significantly lower than Musk’s offer of $54.20 per share, according to FactSet data published by The Wall Street Journal on Monday.

The drop was the largest Twitter had experienced in two months and came after the cancellation of Musk’s deal to buy the social media platform and take it private. Shares of the company are now lower than they were in April, when Musk acquired his initial 9 percent stake in the company.

Meanwhile, shares of Musk-owned automotive company Tesla have fallen by 27 percent since its CEO’s announcement that he would buy Twitter, larger than the overall 10 percent drop in the S&P 500 over that period.

In explaining his decision, Musk claimed that Twitter failed to provide him with necessary information about spam accounts and how common they are.

The multibillionaire’s announcement in April that he would buy Twitter upped the number of investor purchases of Twitter shares by a factor of 11, causing investments to climb before they dropped after Musk’s cancellation of the deal.

Tags Elon Musk
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