The Securities and Exchange Commission (SEC) announced on Friday that it had begun looking into Elon Musk’s purchases of Twitter shares in early April and whether he properly disclosed his stake and his intentions for the social media company.
Elon Musk Twitter Acquisition Deal is Currently on Hold
The Securities and Exchange Commission released a letter sent to the world’s richest man in which it asks a series of questions about how he declared his acquisition of Twitter shares comprising a 9.2% stake on 4 April. The move initiated a barrage of corporate activity that led to Twitter accepting a $44billion takeover bid from Musk on 25 April – although he has since announced that the deal is “on hold” while he aims to acquire more information about the proportion of fake and bots accounts on Twitter.
SEC is Investigating Musk’s Supposed Manipulation in Acquiring Twitter Shares
In the 4 April letter, the SEC questioned why a schedule 13G form disclosing Musk’s acquisition of a large shareholding “does not appear” to have been registered within the required 10 days of the stake passing the 5% level where it needs to be disclosed publicly. According to Musk’s own filing, he passed the 5% level on 14 March and therefore should have filed the form by 24 March.
“Please advise us why the schedule 13G does not appear to have been made within the required 10 days from the date of acquisition as required by rule 13d-1(c), the rule upon which you represented that you relied to make the submission,” stated the SEC in the letter, dated 10 days before Musk announced his takeover bid.
Read more: Twitter Investors Are Now Suing Elon Musk Over Chaotic Twitter Acquisition Process