2.9 for 9.2: The New Landlord
Free Tweets For Everyone! It’s on the house!
Tesla CEO, Elon Musk on Monday purchased a giant 9.2% stake in Twitter for $2.9 Billion – a revelation that’s come hot on the heels of speculation that he might start his own social media platform. No doubt buying into an established company and steering it from within is way easier than starting from scratch. Shares of Twitter soared more than 27 per cent after the news of Musk’s passive stake in the social media company to become its single largest shareholder.
Who would’ve imagined?!!
Below, we’ll look at the top five shareholders of Twitter before this purchase so you have an idea of what Elon has just hit based on the number of shares owned.
- Morgan Stanley
Multinational financial services and investment company Morgan Stanley holds the largest stake in Twitter (as of Q3 2021). Morgan Stanley acts as a wealth management company for roughly $6.2 trillion in customer assets. The firm also has capital markets, sales and trading, research, and investment banking branches. Morgan Stanley’s stake in Twitter amounts to roughly 73 million shares, representing 9.2% of outstanding shares. - The Vanguard Group, Inc.
Investment management company Vanguard Group holds the second-largest stake in Twitter. One of the biggest investment managers globally, Vanguard offers hundreds of mutual funds, ETFs, and retirement products. The company holds about $7.2 trillion in global assets under management (AUM) as of Jan. 31, 2021.
Vanguard’s stake in Twitter represents nearly 70 million shares. This constitutes just under 8.8% of all outstanding Twitter shares. - BlackRock Inc.
The third-largest shareholder of Twitter is the global investment manager BlackRock Inc. (BLK). BlackRock held $9.6 trillion AUM as of the end of 2020. It currently owns nearly 52 million shares of Twitter. This stake accounts for roughly 6.5% of all outstanding shares. - State Street Corp.
Better known as State Street Global Advisors (SSGA), this firm offers a broad array of investment management services to individual and institutional clients. State Street held $3.9 trillion AUM as of Q3 2021.
It owns about 35.5 million shares of Twitter stock with a value of about $2.2 billion. That is about 4.4% of all outstanding shares. - Lone Pine Capital LLC
Lone Pine Capital is a hedge fund that had roughly $30 billion invested in public equities as of Q3 2021. This firm rounds out the list of the top five shareholders of Twitter. This firm owns more than 21 million shares of Twitter, for a stake of about 2.7%.
Whether as an economic, a political or even social media play, Elon Musk definitely knows what he is doing…and even though he seemingly doesn’t always know what he is doing in advance, he kind of always figures it out. Not only is Musk the richest man on Earth today, he is a Genius.
His stake, which is a single class of stock(unlike the other large companies), is now about 4 times the size of Jack Dorsey’s.
Being one of the biggest influencers on the platform with 80 million followers, it has become so important for him and his business.
As one of the largest shareholders he will have enormous influence for sure. He may get a seat on the board and have the ability to put pressure on the stock and inspire voting of shareholders.
Why does this matter?
Because Twitter matters. Like Tucker Carlson said, “Twitter is hardly the largest social media platform, but twitter sets the tone for all news coverage. For all information…”
Without a doubt, it is just the start of a broader strategic focus of twitter whether as regards changing the managing team or ultimately a Buy-out. It’s not really about Musk himself buying Twitter. It’s about him starting to become more active once they go above the 10% stake in terms of strategically whether in terms of getting on the board and then ultimately if Twitter does not listen behind the scenes, this could be something where private equity could be a catalyst to potential acquisition…which may be why the street is feeling it and the stock’s up the way it is.
Can Musk actually change Twitter?
Even though it is being referred to as “Passive stake”, which may mean he’s not going to be an activist investor or demand much change. It may somewhat be in line with how Elon thinks though. He did something similar when he invested in OPenAI due to his concern of uncontrollable AI.
It may be a brilliant move as most investors only care about making money and Musk for sure isn’t one who has made a lot of his investments on that basis. Considering we are in an information war it’s quite refreshing to see that someone isn’t motivated by profit or power will have a seat at the table of these companies that pretty much change the world.
Can a passive stake become something more?
While it may seem possible for him to build an active stake over the next few weeks or months and have it serve whatever purposes his chooses, he may actually not have much interest in it and will likely just hold on to what he now has to ensure there isn’t too much censorship. I don’t think he’s going to just sit satisfied with a 9.2% passive stake though. “Free speech is essential to a functioning democracy. Do you believe Twitter rigorously adheres to this principle?” – Elon Musk. That doesn’t sound very passive though. Lol.
Will Donald Trump be let back on Twitter?
As funny as it sounds, this is one of the questions that has gone round especially since Musk has solidly stood for free speech. It’s too early say though but I think before that happens, we may probably see Elon go after that dude, on twitter, that constantly posts the location of his private jet. Been a hilarious back and forth on that though.
What’s the next big purchase for Elon Musk?
Elon Musk is one person who is really hard to predict, but If Elon Musk buys a news company like CNN (in a similar fashion like Bezos has WAPO), and then a Media company it may be the craziest thing ever.
It’s a big one for Musk and I really can’t wait to see how these all unfolds long term. Got my fingers crossed with best hopes however. 🤞🏽 #OnucheOfTheRoots #Job32:8 💙👑🌍
- https://www.investopedia.com/articles/insights/060916/top-3-twitter-shareholders-twtr.asp
- https://www.thenationalnews.com/business/markets/2022/04/05/twitter-shares-soar-27-after-elon-musk-becomes-largest-single-shareholder/#:~:text=Shares%20of%20Twitter%20soared%20more,become%20its%20single%20largest%20shareholder