Teasey Does It

Image source: Brent Hofacker - Shutterstock

What's going on?

Elon Musk threatened to pull out of his $44 billion takeover of Twitter on Tuesday, as the little minx decides to play a cheeky game of hard to get.

What does this mean?

Elon and Twitter have gone from the Will they? stage of their courtship to the Wont they?: the Tesla CEO said on Friday that he was putting the deal temporarily on hold until Twitter clarified the number of fake accounts on its platform. Twitter claims bots make up fewer than 5% of its users, but Elons skeptical: he suspects its at least 20%. And if there really are fewer eyeballs on Twitters all-important ads, that could mean the company is worth a lot less than he offered. All this came to a head when the worlds richest man put his foot down on Tuesday, saying he wouldnt go forward with his $44 billion takeover bid unless Twitter backs up its claims (tweet this).

Why should I care?

For markets: Is Elon having second thoughts?
Analysts reckon theres one of two reasons for Elons power play: either he wants to find a way to pay less for the platform, or an excuse to walk away from the deal altogether. Investors seem to agree: Twitters stock is sitting 30% lower than the price Elon offered to pay for the company, which just goes to show they dont have high hopes for the deal as it stands either.

The bigger picture: Elon reads the China playbook.
If the acquisition does go through, there could be big changes to come: Elon said this week that hes open to the idea of turning Twitter into a superapp where users can shop, text, and post to social media all in one place much like Chinas WeChat. As plans go, there are worse ones: analysts reckon it would allow him to achieve his goal of quadrupling Twitters revenue by 2028.

Originally posted as part of the Finimize daily email.

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