Tesla Chief Executive Officer Elon Musk has taken a 9.2% passive stake in social media giant Twitter Inc, according to a US Securities and Exchange Commission filing Monday. Shares of Twitter climbed as much as 26% in premarket trading. Based on calculations made from Twitter’s last close, the stake is worth $ 2.8 billion.
This announcement from Twitter came days after Musk conducted a poll on Twitter, asking his 80 million followers if Twitter “rigorously adheres” to the principle of free speech. He had asked his followers to vote carefully adding that the consequences of the poll will be important. Over 70% of the responders responded with a ‘No’. Following the results, he had put out a tweet asking if there should be an alternative to Twitter. He also said he is giving some serious thought to his own social media platform.
“Given that Twitter serves as the de facto public town square, failing to adhere to free speech principles fundamentally undermines democracy. What should be done?” Musk tweeted last month. “Is a new platform needed?” he asked in the following tweet.
Musk is an ardent Twitter user but has lately been critical of the social media giant. He will own 73.48 million shares in the company, making him the largest shareholder in the firm, according to data from Bloomberg. This is more than four times the stake Twitter’s founder Jack Dorsey holds. Elon Musk will hold a stake in the company via Elon Musk Revocable Trust.
“Musk could try to take a more aggressive stance here on Twitter,” Wedbush analyst Dan Ives said. “This eventually could lead to some sort of buyout.”
“This makes sense given what Musk has at least been talking about, at least from a social media perspective,” Ives added.
Earlier in January, billionaire Musk expressed his disapproval of Twitter’s new feature, that lets premium users flaunt their non-fungible token (NFT) purchases as their profile picture. Musk said “this is annoying” in a tweet, adding that the social media giant is not spending its resources well.