Financial Associated Press, May 10 (Editor Niu Zhanlin) Short-selling agency Hindenburg Research Company warned on Monday (May 10) that if the world's richest man Elon Musk abandons the acquisition of Twitter, the deal risks being repriced. The company also revealed that it was shorting Twitter, which fell nearly 4% at one point, and recently recovered to $48.42.
Hindenburg noted in a report: "Musk has all the initiative. It is believed that if Musk's bid for Twitter disappears tomorrow, Twitter's market value will fall 50% below its current level. As such, we see this as a significant risk that Musk's acquisition of Twitter will be repriced at a lower price. ”
Hindenburg said there have been a series of developments in the deal, from financing to board approval, but that is also weakening Twitter's position.
Hindenburg said: "We support Musk's efforts to take Twitter private, but believe that the deal is likely to close at a lower price." ”
The report notes that Musk could exit the deal for a $1 billion breakup fee, and if he does choose to do so, he has the bargaining chips to renegotiate and will also gain a greater advantage.
Last month, Twitter agreed to sell itself to Musk for $44 billion in cash, disclosing last week that it had secured $7 billion in financing from prominent investors including Oracle co-founder Larry Ellison and Sequoia Capital.
Angelo Zino, an analyst at CFRA Research, said that unless Musk changes his mind, there is a good chance that the deal will close at the original offer.