The CEO of Tesla, Elon Musk has taken a passive 9.2 percent stake in Twitter Inc., as he currently owns 73,486,938 shares of Twitter, worth about $2.89bn, based on last Friday’s market close.
This was disclosed on Monday by the US Securities and Exchange Commission 13G filing.
Musk’s purchase is coming just over a week after somewhat denouncing the social platform and polling his 80 million followers on whether or not the platform imposes limitations on “free speech.”
“Free speech is essential to a functioning democracy,” he tweeted, while also asking the question, “Do you believe Twitter rigorously adheres to this principle?”
Over 70% of Musk’s followers voted “no,” prompting the Tesla CEO to follow up by asking what the solution might be.
When asked by a Twitter user if he would consider setting up his own social media platform which prioritised free speech, Musk replied that he was “giving serious thought” to the idea.
Twitter’s shares rose to about 27% in pre-market trading (up to $47.48 per share) on Monday upon the news of Musk’s stock purchase.
The gain marked the stock’s biggest intraday increase since its first day of trading following the company’s 2013 initial public offering.
While it is classified as a passive stake, investors had bided shares higher on the chance that this could lead to something more.
Industry analysts are skeptical about whether Musk will remain on the sidelines for long.
However, Wedbush analyst, Daniel Ives, in a statement to USA TODAY, stated that Musk’s passive stake could be just the beginning.
Ives estimates Musk, the world’s richest man, will eventually pursue an active stake and take a more aggressive role.
Jack Dorsey, the founder of Twitter, only holds a 2.25% stake in the company, meaning Musk holds a little less than 5 times as much of Dorsey’s holding.
Musk’s estimated net worth as of Monday morning was $287.6 billion.