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Wednesday, May 25, 2022

Elon Musk anticipated to function short-term Twitter CEO after deal closes

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Elon Musk is predicted to function a brief CEO of Twitter for just a few months after he completes his $44 billion takeover of the social media firm, sources advised CNBC’s David Faber.

An SEC submitting on Thursday revealed Musk secured roughly $7.14 billion in fairness commitments from buddies and different traders to purchase Twitter. Faber mentioned Musk handpicked the traders. Commitments vary from $1 billion from Oracle co-founder Larry Ellison to $5 million from Honeycomb Asset Management, which invested in SpaceX. Faber added that Twitter co-founder Jack Dorsey might again it, and Musk is speaking to him about the opportunity of contributing shares instantly or earlier than the closing of the merger.

Twitter CEO Parag Agrawal has solely led the corporate for just a few months, after assuming the helm from Dorsey final November. Until now, there hadn’t been a lot dialogue about whether or not Musk’s takeover of the corporate would result in a management shake-up. Last month, Reuters reported Musk had lined up a brand new CEO for Twitter, citing a supply aware of the matter.

Agrawal advised staff throughout a companywide city corridor assembly final month that the way forward for Twitter is unsure beneath Musk, based on a separate Reuters report.

“Once the deal closes, we don’t know which direction the platform will go,” Agrawal reportedly mentioned when requested whether or not the corporate might permit former U.S. President Donald Trump to return to the platform when Musk takes over. Trump was completely suspended from Twitter final yr.

Musk’s acquisition of Twitter comes at a key time for the corporate. Agrawal has mentioned he would deal with rising Twitter’s day by day energetic person base and bringing new merchandise to clients. In the corporate’s newest earnings report, Twitter mentioned it hit 229 million monetizable day by day energetic customers, a 15.9% improve from the identical interval final yr.

Musk, who’s the CEO of Tesla and SpaceX, has just lately led shows in entrance of traders, the place he gave monetary projections primarily based on his evaluation of Twitter, based on sources aware of the scenario who spoke with Faber.

Musk advised traders that he felt Twitter’s earnings earlier than curiosity, taxes, depreciation and amortization margin was too low and the corporate has “too many engineers not doing enough,” Faber mentioned, citing sources acquainted. Musk additionally pledged to make the corporate a “magnet for talent,” Faber added.

Shares of Twitter rose 2.8% on Thursday. Tesla’s inventory slid greater than 8% amid a broader market selloff.

Representatives from Twitter declined to remark.

WATCH: Elon Musk’s problem shall be fixing Twitter, not shopping for it, says Wedbush’s Dan Ives

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