SAN FRANCISCO (CBS SF/CNN) — While stocks took a steep tumble Friday in a widescale Wall Street sell-off, shares of Twitter rose more than 3.23 percent in value as Tesla founder Elon Musk continues his quest to buy the San Francisco-based social media giant.
But the news wasn’t all rosy for Musk. Tesla joined the tech giants across the Silicon Valley in being caught up in the selling frenzy, dropping $3.73 to $1,005 a share.
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The FANG stocks — Meta (Facebook), Amazon, Netflix and Alphabet (Google) — all took tumbles by the closing bell. Meta dropped $2.45 to $185.62 a share. Amazon fell $65.45 to $2,900 a share. Netflix ended a miserable week, dropping $2.50 to $215.72 and Alphabet dipped $97.84 to drop to $2,398.
Overall, the Dow fell 981 points fueled by a flurry of selling off in the final 15 minutes before the closing bell. The Nasdaq Composite dropped 335 points and the S&P fell 121.8 points.
On Thursday, Musk said he has lined up commitments worth $46.5 billion to finance a Twitter takeover deal, one week after he first made a public offer to buy the company.
He said he has commitment letters to finance the deal, including two debt commitment letters from Morgan Stanley and other unnamed financial institutions and one equity commitment letter from himself, according to a filing with the Securities and Exchange Commission.
In the filing, Musk said, that he has yet to receive any formal response from Twitter’s board to his offer to acquire all of its shares that he does not currently own for $54.20 a piece, a deal that would value the company at around $41 billion.
He said he is “seeking to negotiate” a definite acquisition agreement and “is prepared to begin such negotiations immediately” — an apparent reversal from his statement in his acquisition offer letter that it would be his “best and final” offer.
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Questions about whether Musk would actually be able to finance his acquisition of Twitter swirled in the days following his takeover bid, especially after he said in an interview the day of his offer that, “I’m not sure I’ll actually be able to acquire [Twitter].”
Although he is the richest person in the world, much of Musk’s wealth is tied up in Tesla stock, and some followers of the company speculated that it could be challenging for Musk to raise debt against the historically volatile stock.
While Twitter’s board has not formally responded to Musk’s offer, it implemented a so-called poison pill — a defensive measure that could make it harder for him (or any other investor) to buy or take a controlling stake in the company without its approval.
Musk said in his Thursday filing that he is “exploring” whether to launch a tender offer — a move to buy Twitter stock en masse directly from shareholders that could put additional pressure on the board — but “has not determined whether to do so at this time.”
Musk has previously alluded to the possibility of a tender offer in several recent tongue-in-cheek tweets, including one with a fill-in-the-blank word followed by “is the night.”
Morgan Stanley did not immediately respond to requests for comment. In a statement, Brenden Lee, a spokesperson for Twitter, said the company had received the “updated, non-binding proposal” from Musk and the “new information on potential financing.”
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“As previously announced and communicated to Mr. Musk directly, the Board is committed to conducting a careful, comprehensive and deliberate review to determine the course of action that it believes is in the best interest of the Company and all Twitter stockholders,” Lee said.
Source: sanfrancisco.cbslocal.com.