The Elon Musk and Twitter soap opera continues. A few days ago we learned that the businessman had spent 3,000 million dollars secretly buying almost 10% of Twitterall this after saying that he wanted to create an alternative.
The detail is that while he was saying this, he had already become Twitter’s largest shareholder by taking over 9.2% of the total shares, something he should have made public before and that saved him a lot of money. Money that just another shareholder is saying that Elon’s play cost him, and for what wants to start a class action lawsuit.
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The bad “luck” of those who sold before knowing about Musk
The shareholder in question alleges that he sold shares between the time Musk had to reveal his ownership on Twitter and before the actual disclosure. missing out on the consequent rise in share price.
Musk acquired more than a 5% stake in Twitter before March 14, which required him to file a form with the US Securities and Exchange Commission within 10 days, that is, on March 24. yes
However, according to the lawsuit that has been filed in New York, Musk did not do this until April 4, and in that time Twitter shares rose more than 27%. The stock, which was worth $39.31 on April 1, was worth $49.97.
As the lawsuit alleges, “Investors who sold Twitter stock between March 24, 2022, when Musk was supposed to have disclosed his ownership of Twitter, and before the actual disclosure on April 4, 2022, missed out on the increase resulting from the stock price as the market reacted to Musk’s purchases and they were hurt.”
By not disclosing his stake in time, Musk was able to buy shares of Twitter at a lower price. Elon recently declined to join Twitter’s board of directors, so he won’t have to bite his tongue to criticize the company in public like he usually does, and he won’t be limited to owning no more than 14.9% of the shares.