Activist investor Bill Ackman on Monday told CNBC he had not spoken with Elon Musk about a deal involving X, formerly known as Twitter, but that he likes the business and Musk and suggested a deal with X would be welcome if Musk wanted it.
“I have a lot of respect for Musk, I think Twitter is a really important platform, I think he’s made tremendous improvements to the platform, and I think it’s a very difficult-to-disrupt kind of asset,” Ackman told CNBC’s Andrew Ross Sorkin in an interview.
The billionaire CEO of Pershing Square Holdings was discussing his new carve-out vehicle, which he called a SPARC, or special purpose acquisition rights company. The product is similar to a SPAC, but Ackman said Pershing’s structure would only invest in companies it views as long-term investments. SPACs drew tremendous investor and regulatory scrutiny, in part because they favored insiders and allowed them to make huge profits off the backs of nonfavored investors.
![Elon Musk, left, and Bill Ackman.](https://image.cnbcfm.com/api/v1/image/107309926-1696250684107-Untitled-1.jpg?v=1696267965&w=929&h=523&vtcrop=y)
Ackman specifically highlighted X’s crushing debt load — around $13 billion owed to a consortium of banks — as a sensible reason for Musk to agree to the deal and take a part of X public again. The Financial Times reported last month that banks are unhappy and looking for ways to get out.
Ackman made waves in a Sunday interview with The Wall Street Journal, where he said he would “absolutely” invest in X through his new SPARC structure. If part of X were to debut on the market, it would likely be at a valuation far below the $44 billion Musk paid for it. Revenues have reportedly fallen by double-digit percentages, according to Musk, and despite new X CEO Linda Yaccarino’s reputation as an advertising maven, ad dollars have still not returned to pre-acquisition levels.
X also faces increased competition from Meta. Threads debuted with a splash but has struggled to retain users and has fallen off sharply in engagement, according to third-party data reports. Still, Meta has a hefty war chest, a deep engineering bench and existing relationships with major advertisers.
Source : CNBC