(Bloomberg) — Elon Musk acquired a 9.2% stake in Twitter Inc. to become the platform's largest shareholder, a week after hinting that it could shake up the social media industry.
Twitter shares rose around 26% in pre-market operations after the purchase of Musk was revealed on Monday in a regulatory document. The share is worth approximately US$2.89 billion, based on Friday's market closing value.
Musk, 50, surveyed his more than 80 million followers on Twitter last month, asking them if the company adheres to the principles of freedom of expression. After more than 70% said no, he asked if a new platform was needed and said he was seriously considering starting his own.
Musk has been one of the most important personalities on Twitter and has regularly struggled on the platform. The CEO of Tesla Inc. is currently trying to get out of a 2018 deal with the US Securities and Exchange Commission that established controls related to his tweets about the electric car manufacturer.
The announcement will be another important test for Twitter's new CEO, Parag Agrawal, who replaced Jack Dorsey after he unexpectedly resigned in November. Agrawal was committed to increasing accountability, making decisions faster and improving product execution. The company set ambitious goals for growth, including increasing annual revenue to $7.5 billion and reaching 315 million daily users by the end of 2023.
Musk posted a cryptic meme in December after Twitter announced that Agrawal would replace Dorsey as Twitter's chief executive. He represented Agrawal as the Soviet dictator Joseph Stalin who pushed Dorsey into the water, represented as the head of the Soviet secret police Nikolai Yezhov.
It is not clear what Musk is planning with his participation. The filing with the SEC shows that the date of the event that triggered the disclosure was March 14. The type of form used often indicates that the investor is not seeking to acquire control of a company or influence who controls it.
Musk, who is already the richest person in the world according to Bloomberg's billionaire index, has earned around $1.1 billion since mid-March, according to the rise in Twitter shares in the first trade on Monday.
Original Note:
Musk Takes 9.2% Stake on Twitter After Hinting at Shake-Up (2)
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