If at the time Elon Musk announced his intention to buy Twitter, there were shareholders who thought the proposed price of $54.2 per share was too low, then sentiment began to sour over time. Now, Hindenburg Research says Musk has an opportunity to buy Twitter assets at a lower price, and if he exited the deal today, prices would fall by 50%.
According to the opinion analyst, there is a significant possibility that the transaction will be revalued at a lower level. Against this backdrop, shares of Twitter fell 4% to $47.76 a share. After all, if Elon Musk backs out of the deal, he’s only risking $1 billion, and this position in the negotiations gives him the opportunity to negotiate a lower price.
Notably, even Saudi Prince Al-Waleed ibn Talal Al Saud, who thought Musk’s price was too low in April, is mentioned in official documents released this week expressed its willingness to add its $1.9 billion stake in Musk’s deal, but at a price of $54.2 per share.
Hindenburg Research, who is terse on Twitter, says the company has suffered a downturn since Musk’s original bid due to many factors, including a general decline in investor interest in tech assets and weak quarterly earnings. According to the research note’s authors, Musk can still strike a deal with Twitter, but the previously agreed price is difficult to justify under the current conditions. Since Elon Musk announced he has a large stake in Twitter, the Nasdaq index has fallen 17.6%, while shares of Twitter are up 23%.