The possible acquisition of Twitter by Elon Musk continues to generate discrepancies among industry analysts.
As tempting as it may be to count on Elon Musk ‘s wealth , Twitter isn’t about to be ruled by a billionaire known for speaking directly without weighing the consequences. The global messaging platform is trying to prevent Tesla ‘s boss from getting his hands on all of Twitter ‘s outstanding stock, saying concerns about where it might take the company outweigh the reward offered.
“It’s the management, the board of directors, that feels something is wrong,” said Endpoint Technologies analyst Roger Kay. “Musk is essentially an autocrat. His brand of libertarianism has a bit of far-right politics in it,” Kay said.
Earlier this month, Musk, the world’s richest person and a controversial and frequent Twitter user, made an unsolicited $43 billion bid for the social network, arguing that he was motivated by greater freedom of expression. The offer, which he said is not final, values each Twitter share at $54.20, up from the pre-offer closing price but down from a high of $77.06 it hit in February. 2021.
Twitter ‘s board of directors has chosen to swallow a “poison pill”, stating that any acquisition of more than 15% of the company’s shares without its approval would trigger a plan to flood the market with shares and thus It would make the purchase very difficult.
Musk already owns more than 9% of the company, making him its largest shareholder. The billionaire tweeted “Love me tender,” the title of an Elvis Presley song that some have taken as a suggestion that he is thinking of bypassing the board of directors and taking his offer (“tender”) directly to shareholders.
“I think he’s running with scissors,” said analyst Rob Enderle of the Enderle Group. “Poor impulse control and too much money are not a good combination,” he said.
Musk has said that he would like to lift the veil on the algorithm running on the platform, to the point of even allowing people to review it and suggest changes. He defends a non-intervention approach in the surveillance of content, a thorny issue especially in cases of great repercussion such as that of former US President Donald Trump, who was banned from the platform after the assault on Capitol Hill by his supporters when they tried to annul the result of the 2020 US election.
“Musk says he’s going to turn Twitter into a social media platform without moderation. There have been several of those and they don’t work,” analyst Rob Enderle said. “The trolls take control, they become too hostile and drive people away from the platform,” said the head of the Enderle Group.
Attempts to make “right-wing Twitter” have failed, the analyst told AFP, citing Parler and Trump’s own social network as examples. Musk has said that he is reluctant to ban people from Twitter for bad behavior, leading many to think that if he owned the platform he would allow Trump to come back.
Despite his speech about free speech, Musk mocked a Tesla whistleblower and called a rescuer a “pedophile” who questioned the Tesla boss’s idea to save children from a flooded cave in Thailand several years ago. “Musk is not exactly a defender of free speech,” Enderle said. “I think he just doesn’t like being told ‘no,'” he noted.
Details of Musk’s business vision for Twitter are scant, Creative Strategies analyst Carolina Milanesi said. “I don’t think anyone would dispute that everything Elon Musk does, he does for himself,” Milanesi said. “You hear about racism, lack of unions and the way workers are treated at Tesla , and it doesn’t seem to me that their priorities are on the right side,” she said.
Twitter’s board of directors is also likely to be concerned about how, should Musk take control of the company, it would intensify pressure to combat disinformation on social media platforms. “Twitter might be thinking about what regulators are going to do if Musk takes over,” Milanesi said.
“Twitter has been under scrutiny enough already, and it will be even more so if Musk buys it,” the Creative Strategies analyst explained. Although the businessman’s net worth is estimated at $265 billion by Forbes, much of Musk’s wealth comes from shares in the electric car maker Tesla , which he runs.
Moody’s estimated that it would cost Musk $39 billion to buy all of Twitter’s outstanding shares, and that there would be “a strong possibility” that he would have to repay or refinance the billions of dollars of existing debt held by the headquartered company. in San Francisco. Among the rumors that circulate is one that ensures that Musk is studying the possibility of associating with a partner with a lot of money.
In any case, not all analysts are pessimistic and some of them point to Musk’s history as a pioneer as something positive in his commitment to Twitter. “There’s no denying what Musk has accomplished,” RiskSmith chief investment officer Richard Smith said.