9.2 C
New York

Elon Musk-Twitter deal ‘still on course’ despite security report

Published:

Elon Musk’s $44 billion Twitter buyout remains to be expected to shut next week, analysts and a source accustomed to the deal said, despite a curveball report a couple of potential national security review that sent Twitter shares tanking on Friday. 

Twitter shares closed down 4.9% at $49.89 following a Bloomberg report that the Biden administration is considering investigating potential national security risks posed by the deal. 

US officials were reportedly concerned about Musk’s recent threat to chop off SpaceX’s Starlink web service in Ukraine, which he has since walked back, in addition to a report that he discussed the war with Vladimir Putin. Musk denied the story, saying that he hadn’t spoken with Putin since before the war began. 

A source near the deal said Musk is “still on course” to purchase Twitter by the court deadline of next Friday. The source described the Bloomberg story as “political noise.” 

Twitter declined to comment. An attorney for Musk didn’t immediately reply to a request for comment. 

A hedge fund analyst closely following the case outlined 4 scenarios involving the potential national security probe.

The primary and by far almost definitely scenario, the analyst said, is that the Biden administration doesn’t do anything to dam the deal before it goes through or punish Musk afterward.

Blocking the deal would require moving incredibly fast before it’s expected to shut by Oct. 28, while searching for to unwind it after it closes would set the stage for a nasty political fight. 

The second-most likely consequence is that the US forces Musk to exclude foreign co-investors reminiscent of Cayman Islands-based crypto exchange Binance — which is reportedly being investigated by the Department of Justice — and the Qatari sovereign wealth fund. Saudi Prince Alwaleed bin Talal, who already owns a big chunk of Twitter that he had planned to roll over into Musk’s latest company, is also excluded. 

Axing foreign investors could force Musk to provide you with additional cash, potentially by selling Tesla shares, however it wouldn’t prevent him from owning the corporate. 

Elon Musk is “still on course” to purchase Twitter, in keeping with a source near the deal.

The Biden administration was reportedly concerned about threats from Elon Musk to cut off Starlink internet service in Ukraine.
The Biden administration was reportedly concerned about threats from Elon Musk to chop off Starlink web service in Ukraine.

A 3rd option is that the Biden administration’s Committee on Foreign Investment in the USA could force Musk to sell Twitter months after the deal closes, likely for an enormous loss. 

Musk said this week that he’s “obviously overpaying” for Twitter at $44 billion — and analysts say the corporate should really be price something within the ballpark of $20 billion. A recession next yr could drive that price even lower.  

A fourth scenario that the hedge fund analyst called “very, not possible” is that the Biden administration moves to dam the deal inside the following week before the deal officially closes, allowing Musk to avoid owning Twitter. 

That might give Musk the escape route that he appeared to spend months desperately trying to search out before agreeing earlier in October to purchase the positioning for $54.20 per share.

sportinbits@gmail.com
sportinbits@gmail.comhttps://sportinbits.com
Get the latest Sports Updates (Soccer, NBA, NFL, Hockey, Racing, etc.) and Breaking News From the United States, United Kingdom, and all around the world.

Related articles

spot_img

Recent articles

spot_img