Elon Musk Says Twitter Deal Is on Hold, Sending Shares Lower Premarket

Twitter shares were down nearly 20% in premarket trade. Mr. Musk disclosed a 9% stake in the social-networking website last month and sought to buy the remainder of the company at a price of $54.20 a share. He said he had lined up $46.5 billion of funding for the transaction.

Mr. Musk plans to bring a commitment to a more hands-off approach on speech moderation to a company that has struggled to reconcile freewheeling conversations with content that appeals to advertisers.

Some investors saw the pause in the acquisition as a potential sign that the deal may not go ahead.

“I think he’s potentially seeding the ground for pulling out of the deal. That’s certainly the market’s interpretation,” said Michael Hewson, chief markets analyst at

CMC Markets.

“But we’ll have to wait and see, it’s a bit strange to go through all that legwork and pull funding together and then suddenly put it on hold. It is a rather strange development.”

The move comes a day after Twitter said it was pausing hiring and looking to cut costs as it grapples with disruptions in the digital advertising market from global economic turmoil and the war in Ukraine. Across the tech industry, companies are cutting staff and spending or slowing hiring.

Mr. Musk’s tweet comes as many big tech stocks have been falling on Wall Street. Twitter’s stock price had remained below Mr. Musk’s offer price as investors wondered if the deal may get re-worked or not get done.

Twitter said in its most recent quarterly report that by its estimates, false or spam accounts represented fewer than 5% of its daily active users in the first three months of the year.

The social-media company warned that its estimate is based on a sampling of accounts, and that “the actual number of false or spam accounts could be higher than we have estimated.”

The

Tesla Inc.

chief executive had vowed to eradicate fake Twitter users and spam accounts as part of his bid to buy the social-media company.

—Anna Hirtenstein contributed to this article.

Write to Michael Wright at michael.wright@wsj.com