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According to a filing on the U.S. Securities and Exchange Commission, published to their site on Monday, April 4, Elon Musk bought around a 9.2 percent stake in Twitter Inc. The Tesla CEO acquired 73,486,938 shares of the social media giant on March 14, as per the SEC.
The official filing mentioned:
“Amount beneficially owned: 73,486,938 shares consisting of shares of Common Stock held by the Elon Musk Revocable Trust dated July 22, 2003, for which Elon Musk is the sole Trustee.”
Following the news of Musk’s investment, the share price of Twitter surged by almost 25 percent since Friday, April 1. At the time, the 50-year-old billionaire’s new investment would have been worth around $2.96 billion.
However, as of publishing this article, the South African native’s Twitter stake is worth an estimate of $3.63 billion.
Why did Elon Musk acquire a 9.2 percent stake in Twitter?
Musk’s investment in Twitter Inc’s stocks comes after his criticisms of the social media platform towards the end of March. On March 25, the SpaceX CEO polled his 79 million Twitter followers to see whether the platform upheld the values of ‘free speech.’
Following the response from over 2 million followers, the poll’s result declared that for 70 percent of netizens, Twitter does not preserve ‘free speech.’
A day later, Musk asked his followers whether a new platform was needed and also hinted about building his own social media site.
In an earlier tweet, Elon Musk stated:
“Given that Twitter serves as the de facto public town square, failing to adhere to free speech principles fundamentally undermines democracy.”
At the time, his followers thought that Musk might consider building his own social media platform in the future. However, this recent acquisition suggests that he might have been worried about his investment in the firm, considering the public perception of the policies.
Elon Musk’s newfound power at Twitter Inc
The 50-year-old’s acquisition of 9.2 percent of Twitter stock has made him the largest shareholder in the company. Musk owns the stocks under the Elon Musk Revocable Trust, of which he is the sole trustee, as per the SEC filing. This grants him complete control and ownership of his stake in Twitter.
Furthermore, Elon Musk’s stake in Twitter provides him with some sway over the company’s functioning. This was proven by the reports of Elliott Management’s (which owns 9 percent of the stocks in Twitter) alleged demand to replace Jack Dorsey as the CEO.
While it has not been confirmed that the firm had anything to do with Dorsey’s resignation as CEO in November last year, some analysts argue that Elliott Management’s sway might have been one reason.
This essentially means that Musk, who is now the largest individual shareholder, may have similar sway on the company’s functioning and future decisions.
Meanwhile, it is believed that Dorsey reportedly owns over 2 percent of Twitter, which means his stake in the firm is over four times smaller than Musk or Elliott Management.
