Twitter: intriguing deal sparks Elon Musk alert

Musk asked his 122m followers whether he should resign as Twitter CEO – and promised to abide by result

(Image credit: Hannibal Hanschke/Pool/AFP via Getty Images)

published 7 April 2022

Tesla founder, Elon Musk, loves to set the cat among the pigeons. In that respect, his decision to spend $2.9bn on a 9.2% stake in Twitter – making him the company’s largest shareholder – was a textbook move, said Martin Peers on The Information; and to add to the fun, “the world’s most talkative CEO” suddenly came over all “coy” about his motivations. “Oh hi lol,” he tweeted to his 80 million followers as shares in the platform jumped by 27.1%. Musk recently indicated that he was interested in shaking up social media to advance “free speech”. It had been thought he was thinking about starting his own platform, noted The Times, but he has now joined the Twitter board. Conveniently, founder Jack Dorsey – a friend of Musk – is “due to vacate his seat next month”.

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There was speculation that Musk’s investment was simply “a canny value play” for a stock that has fallen by 40% in the past year, said Lex in the Financial Times. His move onto the board suggests he could look to create a “meme stock”. Either way, given his online pull and the tendency of past tweets to land him in “regulatory hot water”, Washington should “set a Twitter alert” if the world’s richest man puts more capital into this deal.

“The hearts of Tesla shareholders must sink every time Elon Musk takes on a new project,” said Nils Pratley in The Guardian. At least this deal (unlike his huge bitcoin investment through Tesla) is “with his own money”. Still, the Twitter stake has the potential to be “a serious distraction from the day job”. Musk’s high profile has saved Tesla a fortune in advertising; but there’s little upside to him getting “sucked into toxic battles” about the role social media plays in the US’s politics. “Leading the electric vehicle revolution is hard enough without unnecessary detours.”