Elon Musk is no fan of the Securities and Exchange Commission. In the past, Musk has called the SEC Short Seller Enriching Commission. However, now Musk is calling on the SEC to open an investigation on Twitter, after agreeing to buy the social media platform for $44 billion.
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Elon Musk is no stranger to bad run-ins with the Securities and Exchange Commission. First, Musk got in trouble with the SEC back in 2018 with his now infamous “funding secured” tweet.
After that debacle, Musk was stripped of his Chairman position at Tesla, ordered to pay 40 million in settlements, and had to agree to have lawyers oversee his tweets.
Musk recently took the SEC to court for failing to disperse the $40 million settlement to affected investors and again trying to lift oversight of his tweets claiming the SEC knew that he indeed had funding secured.
Given this history, Musk is undoubtedly no fan of the SEC. In the past Musk has called the SEC “Short Seller Enriching Commission'' and other more colorful insults.
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However, now the Tesla CEO is calling on the SEC to open an investigation. And even more surprisingly, Musk is asking the SEC to investigate the social media platform he recently agreed to acquire, Twitter.
Musk first announced his intentions to buy Twitter on April 14. Since then Musk has reached a deal with the Twitter board to buy the social media platform for $44 billion.
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However, this deal has not been supported by Tesla’s investor base as evidenced by a 33% decline in Tesla’s shares since April 14. 18% of that decline happened in a 3-day span as Musk was selling Tesla shares to raise the necessary funds to acquire Twitter.
And another 7% decline occurred as news broke Elon Musk will temporarily become Twitter’s CEO once the deal closes.
Given the sharp decline in Tesla’s stock price, there are reports that Elon Musk is under pressure from the EV maker’s investors to abandon the Twitter deal.
Unfortunately, when Musk agreed to buy Twitter, he also signed a deal agreeing to pay $1 billion if he chooses to walk away from the deal. That is unless Musk can prove the Twitter board lied or failed to disclose pertinent information during the negotiations.
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And one issue Musk found is the number of bots that make up the daily active user base of the social media platform. Twitter in a public filing with SEC claims bots make up less than 5% of daily active users.
However, Musk doesn’t seem to agree with that number. At his recent appearance at the All-In Summit Musk said his fear is not that bots make up 7 or 8% of daily active users but that it is 80 to 90 percent.
Given this concern, Musk has been trying to find out more about the method Twitter uses to arrive at the less than 5% number. And Musk says he has grown more concerned as he has tried to get answers.
As of now, it’s not entirely clear if Musk has decided to walk away from the Twitter deal altogether, and what kind of impact that will have on Tesla’s stock price. However, we will be sure to keep you updated as the story unfolds.
Until then make sure to follow our site torquenews.com/Tesla regularly for the latest updates.
So what do you think? Do you think Musk is planning to walk away from the Twitter deal? Also, how do you feel about the Tesla CEO calling on the SEC to investigate Twitter? Let me know your thoughts in the comments below.
Image: Courtesy of Tesla
For more information check out: Why Tesla Is So Misunderstood - Elon Musk
Tinsae Aregay has been following Tesla and The evolution of the EV space on a daily basis for several years. He covers everything about Tesla from the cars to Elon Musk, the energy business, and autonomy. Follow Tinsae on Twitter at @TinsaeAregay for daily Tesla news.
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