Dan ives, a well-known Tesla bull and analyst at Wade Bush securities, said on Monday that he now believes musk is less than 50% likely to complete the twitter acquisition Last week, musk expressed concern about the surge in the number of robots on the social media platform and added that the deal would be put on hold until his concerns were resolved. This led to a 10% plunge in Twitter's share price on Friday.
Ives said in a report on Monday that he thought Musk's concerns about robots were just an excuse, equivalent to saying "homework was eaten by dogs". The billionaire could use this excuse to exit the transaction or reduce his proposed purchase price of $54.20 per share.
"Our view is that the huge pressure on Tesla shares since musk announced the transaction, the changes in the stock market / risk environment in the past month, and many other financing factors have led musk to 'shrink back' on twitter trading. Robots are not a new problem, but may be more an excuse to lower prices," he said
Robots have always been a concern for twitter, but according to ives, Jack Dorsey, the founder and former CEO of the platform, has basically solved this problem in the past few years.
However, musk said that until his concerns about the robot problem are solved, he will temporarily suspend the acquisition of twitter, which puts twitter in a dilemma because no other strategic or financial bidder has offered an offer comparable to Musk's offer.
"Musk knows this, which is why Tesla has lost $300 billion in market value since the transaction in a changing market. We believe that as of today, the possibility of completing the $44 billion acquisition of Twitter is less than 50%," Ives said
Ives said that if the deal was not completed, twitter would receive a $1 billion breakup fee, but that still could not prevent its share price from falling below $30.
"Musk still promised the deal on his twitter and seemed to want to complete it, but the pressure of financing and equity financing put pressure on Tesla, his son of gold, and cast a long shadow on the deal," Ives said