Twitter shares have jumped 8 per cent after Hindenburg Research – best known as a short seller – said it had built “a significant” stake in the social media company that is in a legal battle with Elon Musk.
The move comes after the Tesla chief executive revealed last week that he wanted to pull out of a $44 billion (€43.7bn) deal to acquire Twitter, leading the San Francisco-based group to launch a lawsuit in an attempt to force him to complete the transaction.
“Musk has squandered much of his leverage, largely through misadvised and compulsive tweets,” Hindenburg founder Nate Anderson said in an interview with the Financial Times. “Twitter has a strong case.”
The New York-based firm, which is best known for placing bets against companies, in May closed out its short position in the social media platform. Hindenburg said at the time that there was significant risk the deal between Twitter and Musk would be repriced lower from the originally agreed $54.20 a share.
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“We initially published our short when the share price was at about $48. We closed that out and it was a very good short. Now we think it makes for a compelling long,” said Mr Anderson.
Twitter declined to comment.
The news comes a day after Twitter filed a strongly worded lawsuit against Mr Musk in Delaware chancery court in an attempt to force him to honour his agreement to buy the social media company. Mr Musk on Friday said he planned to back out of the deal. – Copyright The Financial Times Limited 2022
