It should be noted that Musk similarly bought the social media application in 2022, since he made his purchase intentions known through tweets. In April of last year, he decided to buy it for $44 billion, but tried to back out of the deal to get a better price.
I think Twitter should buy SVB and become a digital bank.
— Min Liang Tan (@minliangtan) March 11, 2023
Ultimately, after legal threats, he finished with the purchase and completed his acquisition on October 27, 2022. Had Musk not completed the deal, he would have faced action in the Delaware Court of Chancery, according to CNBC.
One of the consequences that the market is experiencing has been a domino effect and has already affected similar institutions, such as Signature Bank of New York, which saw its share price plummet 23% before operations were halted when the news of the disappearance of SVB arrived.
SVB was more of a niche institution. It specialized in backing tech startups, and its reliance on a small corner of the economy put it at greater odds with a struggling US economy than its larger competitors.
And the impact extends beyond Wall Street. Streaming company Roku, for example, says that 26% of its cash reserves, more than $480 million, are tied up in SVB.
As of Saturday, the company’s shares had fallen more than 42% since last year.