According to reports, Ron Baron, CEO of Baron Capital and one of Tesla’s largest shareholders, said today that Tesla CEO Elon Musk bought Twitter at an “incredibly low price” that will pay off about 3x over the next few years.
Barron has previously been skeptical of Musk’s acquisition of Twitter, calling it “pointless.” But he said today that after two days of preliminary investigations, the plan was found to be interesting.
“If successful, I would expect a 2-3x or higher return over the next 4-5 years,” Barron said. “Given how poorly Twitter is run, such an acquisition is really cheap, even unbelievable.”
Earlier in the day, Twitter said in a filing with the U.S. Securities and Exchange Commission (SEC) that Musk received an additional financing commitment of about $7.1 billion to fund the Twitter acquisition.
Among them, BAMCO, a subsidiary of Barron’s Capital, committed $100 million. Last month, Barron shrugged off Musk’s announcement that he owns 73,486,938 shares, or 9.2%, of Twitter’s shares, making him Twitter’s largest shareholder. “It’s a tiny investment for someone who is worth hundreds of billions of dollars,” he said.
But soon after, Musk offered to buy Twitter for $54.20 per share in cash. On April 25, Twitter announced that it had reached a sale agreement with Musk, which is expected to close by the end of this year.
Another report today said Musk is expected to temporarily serve as Twitter CEO for several months after completing the $44 billion acquisition of Twitter.