Fakoyejo Olalekan
Investors are finding their confidence in Twitter’s growth again, a day after they engaged in a sell off following Elon Musk’s announcement that he’s no longer acquiring the social media company.
Musk had terminated the deal on Friday, citing breach of contract by Twitter board. At the time, the company’s market capitalisation was up at $28.13 billion after trading hours before the weekend break.
Join our WhatsApp ChannelHowever, Prime Business Africa’s analysis shows that the market cap fell by -11.3% after business hours on Monday, as sell off on the exchange floor wiped off N1.36 trillion ($3.18 billion) from Twitter’s market value.
It closed trading at $24.95 billion, with the stock settling at $32.66 per share, down from $38.79 and below the market cap level of Friday, reflecting investors disappointment towards the deal falling through.
The sell off had been triggered by fear of Twitter share losing value, and depreciating in asking price on the exchange floor in future, which would negatively impact their investment value, considering they were holding the shares in hope of Musk acquiring it at the agreed premium price of $54.20 per share.
However, with reports emerging on Monday, stating Twitter’s board has hired a law firm to ensure Musk comply with the agreement to acquire the company at the agreed price, and prevent him from backing out, Prime Business Africa note that investors mood changed positively, as they held on to the shares, following possibility of the deal still completing.
This resulted to the share appreciating by 5.21% to $34.36 per stock on Tuesday at the time of filing this report, in response to Twitter board’s decision to enforce the acquisition at the $54.20 per share.
Currently, Twitter’s market capitalisation is $26.23 billion, above Monday’s level, but below Friday’s market cap.
