Popular businessman, Elon Musk, has put his Twitter (TWTR) takeover bid on hold noting that will only resume when it is verified that less than 5% of accounts on the platform are fake.
Musk had pledged to get rid of fake accounts on the microblogging site when his $42 billion takeover deal materializes. However, in a SEC filing, Twitter estimated that the number of fake accounts on its platform was only less than 5%.
This development caused Twitter shares to sink by 17% to $37,2 during the pre-trading hours while Tesla shares went up by 5% to $769.27 in premarket trading.
The clause of the agreement states that if the Twitter deal does not materialize, Musk will have to pay $1 billion as a termination fee.
Musk’s statement made popular memecoin slump by 7%. It has, however, climbed from $0.0869 to $0.0904.
It is reported that the Tesla CEO is seeking new funding as he looks to abandon previous plans of taking a margin loan against Twitter stocks. And Binance is said to have supported him with $500 million.
Musk who is quite controversial over his interest in several crypto projects began his takeover bid when he acquired a 9.2% stake in Twitter.
He then began to push for a full takeover, stating that he wants to make Twitter a platform where free speech is embraced.
Musk, however, notes that he is still committed to acquisition.