Short-seller Hindenburg has hinted that Elon Musk’s $44 billion Twitter bid could be valued lower if Musk decides to pull out of the deal.
“Musk holds all the cards here. If Elon Musk’s bid for Twitter disappeared tomorrow, Twitter’s equity would fall by 50% from current levels. Consequently, we see a significant risk that the deal gets repriced Lower,” Hindenburg tweeted in his report.
Hindenburg said the deal has seen several developments from financing to board approval, which its believes must have weakened Twitter’s position.
The short-seller noted that Elon Musk could leave the deal by paying the $1 billion transfer fee, which he could renegotiate if he chooses.
In a light-hearted response, Musk tweeted: “Interesting. Don’t forget to look on the bright side of life sometimes!”
Hindenburg expressed a strong desire for Musk to take over Twitter, but called for a deal to be done at a “reasonable price.”
Some critics criticized Musk’s decision to buy Twitter for $44 billion, arguing that the billionaire was paying more for a platform with a weak revenue structure.
The sources for this piece include an article in Reuters.