'$43Bn is a lot to pay for a hobby, even for Elon Musk, amid questions about how he would add value to Twitter'
John Colley, Associate Dean of Warwick Business School, former MD of a FTSE 100 company, and an expert on Mergers and Acquisitions, said:
"The price offered by Elon Musk takes advantage of the current weakness in technology share prices. Twitter is well down from its peak. Over the last year the share price has halved and the 38 per cent premium must look attractive to existing shareholders.
"However, $43 billion seems a lot to pay for a hobby - even for Elon Musk. The delayed announcement had the look of an impulse buy and shareholders will no doubt be asking how he will fund the offer.
"One also wonders how much of a plan there is to add value if his bid is accepted. Previous management have struggled to monetise the model and Twitter did not look like making any return until Donald Trump adopted it as his main channel for communicating with the public.
"The jury is still out on whether Twitter can really compete against Facebook, Google and TikTok."
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