Elon Musk is no longer Twitter's largest shareholder after a surprising move from an investment advisor.
The Vanguard Group has increased its stake in the social media company to 10.3 per cent, which surpasses the Tesla boss' 9.1 per cent share.
The news comes after Musk offered to buy the entire company for a little more than $41 billion.
He said he wants to make Twitter a private company in the hope it will be able to be a true gatekeeper for free speech.
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According to reports, Musk has offered $54.20 per share to take full control.
In a letter to Twitter chairman Bret Taylor, Musk said: "Since making my investment I now realise the company will neither thrive nor serve this societal imperative in its current form.
"Twitter needs to be transformed as a private company. My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder."
According to the Daily Mail, Vanguard Group boosted its stake of Twitter during the first quarter of the year.
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SEC filings delivered on April 8 revealed the asset firm now owns $3.78 billion worth of Twitter shares.
While Vanguard Group is the largest shareholder, Musk remains the biggest individual stakeholder.
However, The Wall Street Journal revealed Vanguard's move will make Elon's bid to take over control of the whole company less likely.
That's because 'the company frequently sides with management on voting issues, and does not usually advocate for changes like a hedge fund or activist investor might'.
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The Twitter board has been locked in heavy discussions since Musk made his bid public.
The tech billionaire has revealed he has a backup plan if his initial offer gets rejected, however he hasn't elaborated further on what it is.
He explained at the TED2022 Conference in Vancouver that his motivation behind the proposal was to ensure Twitter could truly exhibit free speech.
"This is not about the economics," he told the crowd. "My strong intuitive sense is having a public platform that is maximally trusted and broadly inclusive is important to the future of civilisation."
He added: "The civilisational risk is decreased the more we can increase the trust of Twitter as a public platform.
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"Twitter has become kind of the de facto town square, so it's really important that people have both the reality and perception that they are able to speak freely, in the bounds of the law."
Stewart Perrie