Both Twitter Inc. and Tesla saw their share prices drop on Thursday following multibillionaire Tesla CEO Elon Musk’s offer to buy Twitter for $43 million in cash to take the company private.
Twitter (TWTR) stock opened Thursday $48.37 per share — up from Wednesday’s close of $46 — and closed at $45.18, down 1.5%.
Meanwhile, Musk’s Tesla (TSLA) also suffered a loss in the wake of Musk’s bold move, opening at $999 per share Thursday and ending the day at $985, down $3.6%. Tesla closed on Wednesday at $1,022.
Twitter Inc. has a current market cap of nearly $34.6 billion and Tesla’s market cap stands at $1.022 trillion.
Although today’s share price drops were minimal, at least one financial expert thinks the landscape could get worse if Twitter turns down the offer. Yahoo Finance analyst Brian Sozzi predicted on Thursday that Twitter stock could crash 20% if the Twitter board rejects Musk’s offer.
Twitter Inc. revealed in a regulatory filing on Thursday that Tesla CEO Musk, who is currently the company’s biggest individual shareholder, has proposed buying the remaining shares of Twitter not under already under his ownership at $54.20 per share, an offer worth more than $43 billion.
“I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy,” Musk said in the filing.
Al Jazeera reported Thursday that Twitter Inc. has confirmed it received Musk’s bid. “The Twitter Board of Directors will carefully review the proposal to determine the course of action that it believes is in the best interest of the Company and all Twitter stockholders,” Twitter reportedly said.
Musk, 50, is currently ranks as one of the world’s richest people with a net worth of $265 billion. He touted his Twitter offer by linking to the regulatory filing in a Tweet early Thursday morning:
Musk’s acquired a 9.1% stake in Twitter company by mid-March and agreed to join the company’s board of directors — a plan that he reversed in a matter of days last week. The billionaire has been a harsh critic of Twitter, particularly its efforts to moderate content such as misinformation, calls for violence, harassment and conspiracy theories about COVID and the Jan. 6 Capitol insurrection.