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Twitter shares fell as much as 8% in pre-market trading on Friday as investors braced for some last-minute uncertainty Elon Musk’s $44 billion deal to buy the company.
The stock reaction, which rebounded somewhat later in the morning, came after Bloomberg Report That Biden administration officials are in early discussions about the possibility of some Musk projects being subject to national security reviews, including planned Twitter
(TWTR) takes over. In response to a question from CNN, the administration responded to the report, which cited people familiar with the matter.
“We are not aware of such conversations,” National Security Council spokeswoman Adrian Watson said in a statement. A Treasury spokesperson said that CFIUS “does not publicly comment on transactions that it may or may not review” in law and practice.
between the Shared investors equally Those committed to providing funding to help Musk finance the deal are several foreign entities, including Qatar’s sovereign wealth fund and Saudi Prince Alwaleed bin Talal, who was already one of Twitter’s biggest investors before Musk’s proposed acquisition.
In response to a tweet about the Bloomberg report, one user wrote: “It would be hysterical if the government prevented Elon from making big payments for Twitter.” musk replied To that tweet with the “100” emoji, which usually indicates an emphatic agreement, and a crying laughing face emoji.
It is not clear what effect, if any, the reported security review could have on the completion of a deal already subject to months of uncertainty. musk 1 week left to close The deal or facing a rescheduled trial in Delaware Chancery court could force him to take over the social media company.
Twitter declined to comment on the report about the potential review; Musk’s representatives did not immediately respond to a request for comment.
By other accounts, the deal appears to be heading toward completion. separately Report Bloomberg said, on Thursday evening, that bankers and lawyers for both Twitter and Musk are preparing the necessary paperwork to complete the deal. Bloomberg also reported last week that the company had frozen employee stock accounts in anticipation of closing the deal.
On a conference call this week to discuss Tesla’s earnings results, Musk said he was “excited” about the Twitter deal, but also admitted he was “clearly paying too much” for it. “The long-term potential of Twitter, in my view, is an order of magnitude greater than its current value,” he said.
The Washington Post on Thursday mentioned That Musk told potential investors in the deal that he plans to cut roughly 75% of the company’s employees, and that Twitter has already planned mass layoffs even if the deal doesn’t go through, citing internal documents and interviews with people familiar with his case. Neither Twitter nor Musk’s representatives responded to requests for comment about the layoff plans.
Following the Washington Post report, General Counsel on Twitter Sean Edget sent a memo to employees saying the company “has no confirmation of the buyer’s plans after the shutdown and is recommending not to follow the rumors or leaked documents, but rather wait for the facts from us and the buyer directly.”, according to a report by The Washington Post. Bloomberg. A Twitter spokesperson confirmed to CNN the authenticity of the memo.
Musk previously discussed drastically reducing Twitter’s workforce in personal text messages with friends about the deal, which was revealed in court filings, and did not rule out the possibility of layoffs in a call with Twitter employees in June.
CNN’s Matt Egan contributed to this report.
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