Elon Musk Acquires 9.2% Stake in Twitter, Becoming Largest Shareholder

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] Elon Musk, CEO of Tesla, has acquired a 9.2% stake in social media company Twitter, becoming the largest shareholder of the company.

Local media including The Wall Street Journal (WSJ) reported on the 4th (local time), citing the U.S. Securities and Exchange Commission (SEC), that CEO Musk acquired approximately 73,486,938 shares (9.2%) of Twitter stock on the 14th of last month.

Based on last Friday's closing price, this amounts to about $2.89 billion (approximately 3.51 trillion KRW). The Twitter stake secured by CEO Musk is about four times the shares held by Twitter founder Jack Dorsey, who stepped down as CEO last November. It also exceeds the stake of Vanguard (8.79%), the previous largest shareholder.

Following the news of Musk's stake acquisition, Twitter's stock price surged nearly 30% intraday on the New York Stock Exchange. The market is focusing on the possibility of CEO Musk acquiring Twitter.

Some analysts interpret this as a "passive stake," meaning he may not actively participate in company management. However, considering Musk's tendency to frequently express his opinions on social media and his financial strength, there is speculation that he could engage in management anytime through additional purchases.

Eric Ross, an analyst at Cassend Security, said, "There is no such thing as a passive stake," and predicted, "He will definitely roll up his sleeves (and get involved in management)." Angelo Zino, an analyst at research firm CFRA, also suggested the possibility of a full acquisition, saying, "This investment is only a very small part of his wealth."

In particular, last month Musk criticized Twitter for not adhering to the principle of freedom of expression. At that time, he also expressed serious opinions about a new social media platform. Currently, CEO Musk has over 80 million followers on Twitter. He had previously asked on Twitter whether he should sell Tesla shares.

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