The post Elon Musk’s Twitter Acquisition Now Under US Treasury’s Radar! appeared first on Coinpedia Fintech News
On Wednesday, the US Treasury Department began reviewing whether it can investigate Elon Musk’s $44 billion takeover of Twitter. The move comes after Sen. Chris Murphy of the subcommittee on foreign relations sent a letter to the Committee on Foreign Investment in the United States (CFIUS) on Monday. Whereby the CFIUS requested a review of the Twitter transaction.
Notably, the letter argued that the involvement of non-U.S. entities, including Saudi Arabian and Qatari investors, could have national security implications.
CFIUS Treasury officials have not yet determined whether Musk’s acquisition of the social media platform would trigger a national security clearance, according to people familiar with the matter. Musk is a U.S. citizen, and CFIUS scrutiny is often used to screen foreign investments.
Therefore, it is unclear whether they can initiate such a review, and policy experts are divided on whether such a review is necessary. Treasury officials often check whether purchases should be investigated further, but without a full review.
Elon Musk and Twitter Acquisition Under Scrutiny
In a bid to seamlessly acquire the social media giant, Musk did set up a holding company. Saudi Prince Alwaleed bin Talal and his kingdom holding company jointly committed $1.9 billion for the deal, making it Twitter’s second-largest shareholder. Qatar’s sovereign wealth fund, Qatar Investment Authority, and Binance cryptocurrency exchange are reportedly significant investors in the Twitter deal.
Having completed the acquisition deal last week, which he had until last Friday to complete or face legal charges, the billionaire has already made several changes to eliminate Twitter bots. However, some regulators are closely examining if Musk and Twitter threaten the country’s security.
Furthermore, CFIUS, chaired by Treasury Secretary Janet Yellen, has the power to block foreign ownership of top U.S. companies. Notably, Senator Chris Murphy believes these conditions could give non-foreign companies access to classified information, the Washington Post reported on Nov. 2.
However, it was unclear whether Treasury CFIUS officials were aware of the terms granting access to large foreign investors. Furthermore, these review requests are normal in the first place and do not usually end in a full investigation.
Elon Musk has fired a number of executives, including CEO Parag Agrawal, and intends to lay off some employees after taking control of Twitter as interim CEO. Additionally, Musk decided to offer US customers a Twitter Blue subscription for $8 a month. However, the billionaire noted that prices are adjusted through purchasing power parity in other countries.