The week in business: the Twitter offer

Elon Musk on Monday reached a deal to buy Twitter for around $44 billion, a deal that was unanimously approved by Twitter’s board of directors. The price stands at $54.20 per share, a 38% premium to the company’s share price in April, before Mr Musk revealed he had bought a 9% stake in Twitter. Within weeks, Mr. Musk, the richest person in the world, transformed his offer from something investors ignored to a serious proposition. The turning point came when he filed documents showing he had the funding to back his bid. According to Dealogic data, this could be the biggest corporate takeover in at least 20 years. Still, many remain uncertain about how the mercurial billionaire will realize his vision for a platform with less restraint.

The latest chapter in one of Wall Street’s most high-profile investigations in years unfolded on Wednesday, when federal agents arrested Bill Hwang, the owner of investment firm Archegos Capital Management, and its former chief financial officer. , Patrick Halligan, at their home. . According to a 59-page indictment, the pair were charged with racketeering conspiracy, securities fraud and wire fraud, all in a scheme that involved deliberately misleading banks and manipulate stock prices. Initially, they were able to escape scrutiny due to loose regulations regarding “family offices” like Archegos – companies that handle investments for the ultra-rich. But the company imploded last year and $100 billion in shareholder value disappeared almost overnight. Through their attorneys, the men pleaded not guilty.

The US economy contracted in the first three months of the year, with gross domestic product shrinking 0.4% in the first quarter after adjusting for inflation, or 1.4% on an annualized basis . The decline was largely related to slower inventory growth and a growing trade deficit, with U.S. exports largely outpaced by imports. In the absence of those, a measure of underlying growth rose 0.6% in the first quarter, and the White House preferred to focus on the data without what President Biden called the “factors.” techniques” of stocks and trading. Mr Biden also pointed to bright spots in the GDP report on Thursday that showed strong consumer spending and continued business investment – ​​signs that the economic recovery is still resilient.

Employment numbers for April will be released on Friday and are expected to resemble those for March. Analysts expect a gain of around 385,000 jobs – US employers added 431,000 in March – and an unchanged unemployment rate of 3.6%. Last month, some economists suggested that jobs “could be approaching their prime” and that factors such as rapid inflation and higher interest rates could soon slow the labor market. The economy has recovered more than 90% of the 22 million jobs lost at the height of the pandemic shutdowns in the spring of 2020, but interventions by the Federal Reserve and other forces threaten to cut back on those gains.

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