U.S. officials are looking into Elon Musk’s acquisition of the biggest single person holding in Twitter after he neglected to declare the transaction and therefore failed to offer adequate notice that a takeover attempt was imminent. The inquiry, which is still in its early stages, might spark a firestorm between Musk and financial authorities, just as Musk is attempting to complete his acquisition of Twitter, which was authorized on April 26.
It also comes amid rampant conjecture about what the world’s wealthiest man would do with Twitter once he becomes in control. On Tuesday, he said that Donald Trump will be allowed back on Twitter, in accordance with his prior statements that he would prefer to err on the side of free expression over bans and censorship. Jack Dorsey, the co-founder and former CEO of Twitter, denied on Wednesday that he had been rehired to lead the Musk-owned firm.
With the agreement to take Twitter private anticipated to take two to three months to complete, speculation over Musk’s next move is heating up. In mid-February, the 50-year-old made his first step toward acquiring Twitter by purchasing a 9.2 percent interest in the firm. However, he did not notify the Securities and Exchange Commission (SEC) about his purchase until April 4, more than ten days later.
Any investor who owns more than 5% of a company must submit a form with the Securities and Exchange Commission (SEC) within 10 days. It acts as an early warning to stakeholders that a large investor may be interested in gaining control of the firm. Musk described his position in Twitter as “passive” in his April 4 declaration, indicating that he had no plans to take over the company or affect its management or operations.
The following day, he was given a place on Twitter’s board of directors, and a few weeks later, he had sealed a $44 billion agreement to purchase the social media behemoth. The Wall Street Journal broke the story of the SEC inquiry on Wednesday. Musk, who is notorious for his outspoken Twitter outbursts, has a lengthy history of clashes with the Securities and Exchange Commission.
Most recently, a US court chastised him for attempting to avoid a deal with the Securities and Exchange Commission that required control of his Tesla tweets. The Federal Trade Commission is investigating whether Musk broke a statute requiring firms and individuals to notify certain big transactions to antitrust enforcement authorities, according to the Information.
Dorsey, who stepped down as CEO in November and was replaced by Parag Agrawal, has been a vocal supporter of Musk’s actions and has been consulting with him on the company’s course — most recently, admitting that he and Musk discussed Trump’s reinstatement and agreed it was the appropriate decision.
I anticipate that @elonmusk will ultimately simply ask @Jack to be the CEO of Twitter,’ tweeted musician and YouTuber Charles Wienand. ‘Nah, I’ll never be CEO again,’ Dorsey answered. When asked who should be CEO, Dorsey said, “Ultimately, no one.” ‘What if the title is Big Bird?’ quipped Mark Milian, Bloomberg’s technology editor. ‘Tempting,’ Dorsey said, and when the job title Technoking was offered, he replied, ‘Taken.’ Another, more important question was whether Dorsey would like the position. ‘nah. ‘It’s time to play the dice once again,’ he said.