(Bloomberg) -- The confusion surrounding Elon Musk’s takeover bid for Twitter Inc (NYSE:TWTR). has delivered millions in paper profits to short sellers betting that the world’s richest person won’t follow through on his purchase of the social media platform.
Twitter’s roughly 9.5% drop in the first hour of Friday’s trading delivered a $136 million boost in mark-to-market profits for short sellers, according to S3 Partners data, bringing potential returns for the month to $262 million. That figure is likely a bit smaller with shares down 8.2% as of midday in New York, though skeptics who bet against Musk’s $44 billion offer last month are still well in the green.
Musk sent a tweet on Friday saying that his offer was “temporarily on hold” before quickly maintaining that he is “still committed” to the deal. The pair of messages sent Twitter shares into a tailspin with the gap between his $54.20 offer price and the stock’s trading widening to the largest since it was struck.
Read more: Twitter-Musk Deal Spread Blows Out After Purchase Put ‘On Hold’
Roughly 1.32 million shares, worth $60 million, were shorted over the last week as the spread started to widen, according to Ihor Dusaniwsky, S3 Partners’ managing director of predictive analytics, who called the base of short sellers “reinvigorated.” However, on the whole, Twitter shorts are still down for the year, losing roughly $72 million, he said by email.
Roughly 5% of Twitter shares available for trading are currently sold short, worth about $1.43 billion, the firm’s data show.
“Twitter’s price volatility due to Elon Musk’s offer and tweets has made both the long and short side of this trade exceedingly volatile with profits and losses swinging wildly from day-to-day,” Dusaniwsky wrote.
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