Suddenly, Twitter’s Biggest Actor Is Tesla’s Elon Musk – GV Wire
Tesla CEO Elon Musk has bought a 9% stake in Twitter to become its largest shareholder at a time when he questions the social media platform’s dedication to free speech and the First Amendment .
The ultimate goal of Musk’s purchase of 73.5 million shares, worth around $3 billion, is not known. However, at the end of March, Musk, who has 80 million followers on Twitter and is very active on the site, wondered freedom of expression on Twitter and if the platform is undermine democracy.
It is unclear exactly when Musk bought the stake. A U.S. Securities and Exchange Commission filing made public on Monday says the event triggering the filing occurred on March 14. His participation meets the criteria of a “passive” long-term investor, seeking to minimize the purchase and sale of shares.
Could consider full takeover
Yet Musk also raised the possibility, publicly ahead of his massive and loyal following on Twitter, that he could create a rival social media network.
Industry analysts are skeptical whether the Mercurial CEO will be on the sidelines for long.
In a note to investors, CFRA analyst Angelo Zino wrote that while Musk’s intent is unclear, Twitter could be considered an acquisition target as its stock value has fallen since the beginning of last year.
Jack Dorsey stepped down as CEO in November. Musk’s stake in Twitter is more than four times that of Dorsey, who co-founded the company and was the largest individual shareholder until Musk joined.
“Musk’s actual investment is a very small percentage of his wealth, and a full buyout should not be ruled out,” Zino, who covers Twitter and social media, wrote.
Twitter stock jumped more than 28% on Monday. Since March 14, the date reported in the U.S. Securities and Exchange Commission filing, Twitter shares have risen nearly 50%, meaning Musk’s investment has largely paid off so far. .
Twitter did not immediately respond to a request for comment.
Musk told his millions of Twitter followers that he was ” think seriously to create his own social media platform, and has repeatedly clashed with financial regulators over his use of Twitter.
Musk Fighting Regulators Over Tweets
Musk is locked in a bitter dispute with the SEC about his ability to post on Twitter. His attorney argued in court filings that the U.S. Securities and Exchange Commission violated the Tesla CEO First Amendment Rights.
In October 2018, Musk and Tesla agreed to pay $40 million in civil fines and for Musk to have his tweets cleared by a corporate lawyer after he tweeted that he had the money to take Tesla $420 per month private. stock.
Funding was far from secured and the electric vehicle company remains public, but Tesla’s stock price surged. The settlement specified governance changes, including ousting Musk as chairman of the board, as well as preapproving his tweets. The SEC filed a securities fraud charge, alleging Musk manipulated the stock price with his publications.
Musk’s attorney is now asking a U.S. District Court judge in Manhattan to strike down the settlement, saying the SEC is harassing him and infringing on his First Amendment rights.
The SEC responded in a court petition, saying it had the legal authority to subpoena Tesla and Musk over his tweets, and that Musk’s decision to reject the settlement was not valid.
The SEC also revealed it was investigating Musk’s Nov. 6, 2021 tweets that asked followers if he should sell 10% of its Tesla stake. The commission confirmed it issued administrative subpoenas while investigating whether Musk and Tesla were complying with disclosure controls in the 2018 agreement.
Musk ended up selling over 15 million shares worth around $16.4 billion. With some selling at the end of December, Musk is close to selling 10%.
Move follows Tesla delivery report
Musk’s Twitter tweets and stock purchase came after Donald Trump was banned from Twitter and other social media platforms following the Jan. 6 Capitol riot last year that critics accused him of instigating. The ban has raised tough questions about free speech in a social media industry dominated by a few tech giants — an issue that Trump and conservative media have seized on.
Musk hasn’t spoken specifically about how he would change the rules on Twitter, but the social media platform’s history of suspensions and bans is well documented.
Earlier this year, Twitter banned far-right U.S. Representative Marjorie Taylor Greene’s personal account for multiple violations of the platform’s COVID-19 misinformation policy. The Georgia Republican’s account has been permanently suspended as part of Twitter’s “strike” system, which uses artificial intelligence to identify posts about the coronavirus that are misleading enough to cause people harm. Two or three strikes earn a 12-hour account lockout. Four strikes result in a one-week suspension. Five or more warnings can result in someone being permanently removed from Twitter. Twitter previously suspended Greene’s personal account for periods ranging from 12 hours to a full week.
Others banned from Twitter in recent years include Steve Bannon, for suggesting the beheading of Dr. Anthony Fauci, former Ku Klux Klan leader David Duke for breaking the social media site’s rules banning hate speech , and right-wing conspiracy theorist Alex Jones and his Infowars show abusive behavior.
Musk’s revelation about his stake in Twitter stocks comes two days after Tesla Inc.’s Q1 release delivery numbers. While the company delivered 310,000 vehicles during the period, the figure was slightly below expectations.