Full story: Twitter takeover quickly on hold, says Elon Musk
Dan Milmo
Elon Musk has mentioned his $44bn takeover of Twitter is “temporarily on hold” after the social media platform claimed that lower than 5% of its customers had been spam or pretend accounts.
The Tesla chief tweeted on Friday morning that the deal was being frozen whereas he awaited particulars behind Twitter’s assertion.
Musk introduced the transfer alongside a hyperlink to a Reuters article revealed on 2 May that referred to a submitting with the US monetary regulator, during which Twitter claimed that false or spam accounts represented lower than 5% of its every day common customers.
Twitter deal quickly on hold pending particulars supporting calculation that spam/pretend accounts do certainly characterize lower than 5% of customershttps://t.co/Y2t0QMuuyn
— Elon Musk (@elonmusk) May 13, 2022
Musk has railed at automated Twitter accounts – which aren’t run manually – and mentioned after saying the takeover that he wished to enhance the platform by “authenticating all humans”. He has agreed to pay a $1bn break payment to Twitter if he walks away from the deal.
The information despatched Twitter’s shares down about 23% in pre-market buying and selling, on issues that the deal might collapse.
Musk: Still dedicated to acquisition
Elon Musk has now tweeted that he’s “Still committed” to the acquisition….
Still dedicated to acquisition
— Elon Musk (@elonmusk) May 13, 2022
Full story: Twitter takeover quickly on hold, says Elon Musk
Dan Milmo
Elon Musk has mentioned his $44bn takeover of Twitter is “temporarily on hold” after the social media platform claimed that lower than 5% of its customers had been spam or pretend accounts.
The Tesla chief tweeted on Friday morning that the deal was being frozen whereas he awaited particulars behind Twitter’s assertion.
Musk introduced the transfer alongside a hyperlink to a Reuters article revealed on 2 May that referred to a submitting with the US monetary regulator, during which Twitter claimed that false or spam accounts represented lower than 5% of its every day common customers.
Twitter deal quickly on hold pending particulars supporting calculation that spam/pretend accounts do certainly characterize lower than 5% of customershttps://t.co/Y2t0QMuuyn
— Elon Musk (@elonmusk) May 13, 2022
Musk has railed at automated Twitter accounts – which aren’t run manually – and mentioned after saying the takeover that he wished to enhance the platform by “authenticating all humans”. He has agreed to pay a $1bn break payment to Twitter if he walks away from the deal.
The information despatched Twitter’s shares down about 23% in pre-market buying and selling, on issues that the deal might collapse.
More evaluation from Wedbush’s Dan Ives:
The implications of this Musk tweet will ship this Twitter circus present right into a Friday the thirteenth horror present as now the Street will view this deal as 1) doubtless falling aside, 2) Musk negotiating for a decrease deal worth, or 3) Musk merely strolling away with a $1 billion breakup payment
— Dan Ives (@DivesTech) May 13, 2022
In our opinion, with the character of Tesla shares getting used as leverage for Musk within the deal, the large sell-off seen in Tesla and the overhang created by this deal has became a lifetime of its personal. The preliminary response will probably be optimistic for Tesla shares as a aid.
— Dan Ives (@DivesTech) May 13, 2022
Under the deal, Elon Musk and Twitter every agreed to pay the opposite $1bn if their proposed merger falls aside due to the actions of both facet.
Mirabaud: the Twitter tragi-comedy continues
The entire scenario is ‘farcical’, and Twitter’s board should take a number of the blame.
So explains Neil Campling, head of TMT analysis at Mirabaud Equity Research:
“The tragi-comedy continues and the Twitter scenario is nothing wanting laughable. We’d all the time mentioned Musk might lower or run or change his tune on the eleventh hour and 59 minutes and 59 seconds on the clock. We’re not even shut to the eleventh hour but. Farcical.
Musk has by no means had the complete funding – we all know that from his fixed makes an attempt to get monetary assist – however he additionally held all of the playing cards. The Twitter board have been held hostage and solely have themselves to blame for this mess. No different purchaser will emerge – if Musk decides he’s nonetheless he can “name his price”… and it received’t be greater!
The board ought to have seen this coming. There was a particular efficiency clause within the merger settlement (part 9.9), which gave Twitter the proper to “consummate the closing (of the deal)” however provided that Musk had the financing – which, after all, he doesn’t.”
Elon Musk could also be having second ideas in regards to the deal, says John Colley, Associate Dean at Warwick Business School:
‘Fake accounts’ had been all the time a probable subject, however didn’t dissuade him from launching his bid. Bringing it up now may be an excuse to withdraw gracefully.
“Maybe the true cost and extent of the risk involved in turning around a ‘break even’ Twitter may have dawned on Elon Musk. After all, $43Bn for what may be little more than a sideline does seem excessive. The collapse in Tesla’s shares following the original offer announcement underlines what the markets think.”
Musk’s transfer will probably be ‘highly frustrating’ for a lot of at Twitter, says Susannah Streeter, senior funding and markets analyst, Hargreaves Lansdown.
‘’Musk’s Twitter takeover was all the time destined to be a bumpy journey, and now it dangers hitting the skids over the variety of pretend accounts on the platform. Twitter’s share worth plunged by round 18% in pre-market buying and selling following his tweet indicating the deal was quickly on hold.
He is clearly intent in querying the corporate’s estimate that spam accounts make up lower than 5% of lively every day customers – a key metric on condition that establishing an correct variety of actual tweeters is taken into account to be key to future income streams by way of promoting or paid for subscriptions on the location.
This is probably going to come as extremely irritating for a lot of within the firm on condition that plenty of senior executives have already been laid off in expectation of the takeover and the change in path he was anticipated to pursue.
Twitter’s head of shopper product, Kayvon Beykpour, and head of income, Bruce Falck are among the many departures.
Beykpour, who joined when Twitter purchased his Periscope live video service, realized he was leaving whereas on paternity depart.
Interrupting my paternity depart to share some remaining @twitter-related information: I’m leaving the corporate after over 7 years.
— Kayvon Beykpour (@kayvz) May 12, 2022
The reality is that this isn’t how and after I imagined leaving Twitter, and this wasn’t my resolution. Parag requested me to depart after letting me know that he desires to take the staff in a unique path.
— Kayvon Beykpour (@kayvz) May 12, 2022
Also, what’s Musk’s actual motive, Streeter provides:
There may also be questions raised over whether or not pretend accounts are the true cause behind this delaying tactic, on condition that selling free speech moderately than focusing on wealth creation appeared to be his major motivation for the takeover.
The $44bn price ticket is big, and it could also be a method to row again on the quantity he’s ready to pay to purchase the platform.’’
“This is a full on Friday the 13th circus show”
Wedbush Securities analyst Dan Ives says it’s “a full on Friday the 13th circus show”.
Speaking to CNBC’s SquawkBox present as information broke that the deal was on hold, Ives known as Musk’s transfer ‘a shocker’.
He defined it’s not OK to merely put a deal on hold with a tweet. You’d count on a regulatory submitting with a deal of this kind, or one thing else extra formal.
Ives explains.
To come out in a tweet, it sends this entire factor right into a circus present.
Because now, the Street’s preliminary response goes to be, ‘he’s on the lookout for a manner to get out of this deal’.
Ives factors to the large fall in Tesla’s share worth (down 1 / 4 within the final month). The deal’s funds included a margin mortgage secured in opposition to a few of Musk’s Tesla shares.
Ives additionally factors out that Twitter’s submitting, stating false or spam accounts represented fewer than 5% of every day customers, got here out on May 2nd, so isn’t a sudden growth.
Parmy Olson of Bloomberg Opinion has a very good take too:
Elon Musk taking a step that *might* lead to him strolling away fully from his Twitter deal right here, saying it’s “temporarily on hold.” ????
If Musk is on the lookout for a manner out, he might level to the proliferation of spam bots. https://t.co/1qMk5eA2Pv
— Parmy Olson (@parmy) May 13, 2022
The massive query: is he joking?? Well #TWTR simply dropped 20% #TSLA up 5%. So traders suppose that is actual. Of course, the market has been burned earlier than by Elon, see: https://t.co/63hVX95SH8
— Parmy Olson (@parmy) May 13, 2022
If actual, that is actually bizarre. Purging spam bots was Musk’s prime goal in shopping for Twitter. Now he is positioning himself to argue the issue is worse than he was led to imagine?
Twitter mentioned they characterize lower than 5% of every day customers. Musk now desires extra proof, “or else.”
— Parmy Olson (@parmy) May 13, 2022
Musk mentioned just a few weeks in the past that he would “defeat the spam bots or die trying.” https://t.co/VMK8NMv3g6?
Now he sounds so much much less obsessed with that, as a result of the ACTUAL BID hinges on how dangerous the spam bots are.
— Parmy Olson (@parmy) May 13, 2022
There are many good explanation why it’s in Musk’s finest pursuits to drop this deal, eg:
– It’s going to be extraordinarily laborious to attain his profitability goal for Twitter
– The deal is killing Tesla sharesBut it appears like he might use spam bots as a public excuse to stroll away.
— Parmy Olson (@parmy) May 13, 2022
Could Musk be on the lookout for a manner out of the Twitter deal, given current market turmoil, or probably to reprice it?
Tech shares have slumped since he revealed his stake in Twitter at first of April, in order that $44bn supply might now look too excessive.
New York Times monetary editor Anupreeta Das factors out that Twitter’s shares by no means reached Musk’s supply, reflecting doubts in regards to the deal:
It’s laborious not to instantly take into account the truth that there’s been a market massacre in current days, and each purchaser might be analyzing whether or not the worth they provided to pay appears too wealthy.
— Anupreeta Das (@PreetaTweets) May 13, 2022
Twitter’s shares are down 25% pre-market, which isn’t shocking. But the shares by no means got here shut to Musk’s $54.20 supply worth to start with, reflecting the doubt in traders’ minds that the deal would really shut.
— Anupreeta Das (@PreetaTweets) May 13, 2022
Elon Musk says Twitter deal is on hold till he will get extra details about pretend accounts
Just in: Elon Musk’s $44bn deal to purchase Twitter is “temporarily on hold” till he will get extra details about pretend accounts on the platform.
The billionaire has tweeted that the deal is on hold, ready for particulars supporting the calculation that pretend and spam accounts characterize lower than 5% of the customers on its platform, as Twitter mentioned in a submitting earlier this month.
Musk linked to a Reuters report from May 2, which mentioned Twitter estimated that false or spam accounts represented fewer than 5% of its monetizable every day lively customers through the first quarter.
Twitter deal quickly on hold pending particulars supporting calculation that spam/pretend accounts do certainly characterize lower than 5% of customershttps://t.co/Y2t0QMuuyn
— Elon Musk (@elonmusk) May 13, 2022
The information has despatched Twitter’s shares plunging round 23% in pre-market buying and selling, on issues that the deal might collapse.
They’ve on observe to open at $34.60, down from round $45 final evening, and away from Musk’s agreed supply of $54.20.
Musk has beforehand mentioned that one among his priorities as soon as he purchased Twitter could be to take away “spam bots” from the platform.
But he additionally warned earlier this week that the deal would take at the least one other two months to complate, and was “not a done deal.”
That takeover has already led Twitter to announce a hiring freeze, and the departure of two prime leaders in a serious shakeup.
Eurozone industrial manufacturing declines as Ukraine conflict takes toll
Factory output throughout the eurozone fell in March, as rising enter costs and provide chain disruption due to the Ukraine conflict hit the sector.
Industrial output from factories, mines and utilities throughout the area declined by 1.8% in March – the primary full month of the battle – in contrast with February, and had been 0.8% decrease than a yr in the past.
Production of capital items fell 2.7%, suggesting demand for heavy obligation equipment, tools, autos and instruments declined as financial uncertainty rose.
Production of non-durable shopper items declined 2.3%, whereas intermediate items (used to make items on the market) dropped 2.0%, and vitality fell 1.7%. But manufacturing of sturdy shopper items rose 0.8%.
Germany noticed one of many largest month-to-month declines, with manufacturing down 5%, together with Slovakia (-5.3%) and Luxembourg (-3.9%), whereas the very best will increase had been noticed in Lithuania (+11.3%), Estonia (+5.1%), Bulgaria and Greece (each +5.0%).
Euro space industrial manufacturing -1.8% in March (-2.0% anticipated).
Bad information, Germany is among the many largest losers, reporting 5% decrease manufacturing. pic.twitter.com/HoQPDoigLA
— Growth & Value (@Growth_Value_) May 13, 2022
‘Golden era’ of low-cost meals is ending, says ex-Sainsbury’s boss
Kalyeena Makortoff
The UK’s “golden era” of low-cost meals is coming to an finish, the previous Sainsbury’s boss Justin King has warned, saying households needs to be ready for greater grocery payments in the long run.
King claimed supermarkets couldn’t be anticipated to take up the additional prices solely or defend customers from rising costs, regardless of having introduced greater earnings, as their web revenue margins are solely round 3%.
Instead, consumers should making laborious decisions on how they spend their cash, notably as hovering inflation – made worse by the ripple results of the conflict in Ukraine – pushed up costs on grocery store cabinets.
King informed BBC Radio 4’s Today programme
“We have been maybe via a golden period. We spend a lot much less as a proportion on common of our family budgets on meals than we had virtually any time in historical past, and that’s been [on] an extended, mild decline. So I believe what we are going to see is a better proportion, throughout the piece, spent on meals for the long term.
“It won’t actually be that high in historical terms but it will require adjustments in terms of how we all prioritise our family budget spending,” King added.
Here’s the complete story: