Elon Musk wants Twitter again — and Twitter is game. The billionaire CEO of Tesla’s bid to buy the business for the previously agreed-upon $44 billion price has brought the tumultuous, months-long voyage one step closer to an end.
According to a regulatory filing on Tuesday, Elon Musk wrote to Twitter on Monday offering to carry out his plan to purchase the firm at the initially agreed-upon price of $54.20 per share.
In the letter, Musk stated that he would carry out the acquisition in accordance with the original terms, pending receipt of the debt financing for the transaction. Musk also requested that the Delaware Chancery Court stay the legal actions related to Musk’s initial attempt to cancel the deal and postpone the trial that was scheduled to follow.
In response to CNN, a Twitter spokesman confirmed that the business had received Musk’s letter and reaffirmed its “intention is to close the deal at $54.20 per share.”
“Buying Twitter is an accelerant to creating X, the everything app.” The billionaire tweeted the following day.
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How the News on Twitter Was Revealed
The news of the letter was received earlier on the 4th of October, 2022. Two times, the second for pending news, the Twitter (TWTR) stock was suspended. The stock was up more than 20% when trading began, surpassing $51 per share and, for the first time in months, getting close to the transaction price.
The announcement comes as the two sides have been gearing up for the trial that will take place in two weeks about Musk’s effort to cancel the $44 billion acquisition agreement, which Twitter had sued him to fulfil. Musk’s attorneys were scheduled to question Twitter CEO Parag Agrawal on Monday, and Twitter’s attorneys intended to question Musk beginning on Thursday.
It also comes after a wealth of Musk’s private text messages over the deal were made public on Friday. The communications gave him a glimpse of the cast of Silicon Valley insiders and billionaires who got in touch with him to provide their opinions and, in some cases, provide finance for the acquisition, from Larry Ellison to members of the Murdoch family.
Such a deal may end the bitter, months-long back-and-forth between Musk and Twitter, which has left employees, investors, and users of one of the world’s most significant social media platforms in great worry.
It will now be up to Twitter to decide how to react to Musk’s suggestion. Josh White, an assistant professor of finance at Vanderbilt University, predicts that the board of Twitter will approve moving forward with the acquisition.
They and the Twitter staff have undoubtedly suffered because of the highly publicized story, according to White. “The very public saga has certainly taken a toll on them and Twitter employees,” White said. “It is best for all parties to finish the deal and make a quick and seamless transition. I suspect it will close quickly,” he added.
According to Musk’s suggestion, Twitter might not want to put the legal action on hold until the transaction is fully completed, says Eric Talley, a professor at Columbia Law School. If Musk’s offer to close the sale again falls through during negotiations, the business might wish to move forward with legal action.
“Twitter is probably going to say, ‘look, we definitely want to engage you on this … But we’ve still got a trial on Oct 17, and until this is signed, sealed, and delivered, we’ve got to get ready for trial,” said Talley.
Elon Musk’s Initial Decision
The saga officially began when Musk declared he had become Twitter’s largest shareholder in April. In the following months, Musk accepted and later declined an invitation to join Twitter’s board, threatened a hostile takeover of the company, finalized a purchase agreement for the business, began voicing concerns about bots on the platform, tried to terminate the agreement, was sued by Twitter to finalize the deal, and added allegations from a Twitter whistleblower to his case.
Initially, Musk decided to terminate the contract because the company had exaggerated the quantity of spam and fake bot accounts on the website.
After the general market fall, which also damaged Tesla shares and, by extension, Musk’s fortune, Twitter alleged that Musk had broken the agreement and was using bots as a cover to back out of a transaction.
Throughout the back and forth, Twitter had steadfastly maintained that it planned to move forward with the deal at a price and the original terms.
According to many legal experts, Twitter has a stronger case in court, and Musk would have difficulty demonstrating that the firm made materially false representations in the purchase contract or its securities filings.
The lawsuit was the final impediment to the merger’s conclusion after Twitter shareholders accepted the acquisition last month. The agreement was originally scheduled to close this month.
With reports that the acquisition might actually close, the focus may once again turn to what Musk’s power over the social media platform might entail.
Musk has already proposed a number of potential improvements to Twitter, the two biggest of which might be the reinstatement of former President Donald Trump and the elimination of permanent account bans. Additionally, Musk has stated that he wants to open up Twitter to “free expression” and may alter its content management guidelines.
Workers at Twitter have also questioned the potential effects of a Musk takeover on benefits like parental leave and remote working. In a statement to staff members on Tuesday, Twitter General Counsel Sean Edgett stated that the business had received Musk’s letter and intended to conclude the acquisition at $54.20 per share. A copy of the message released by CNN quotes him as saying, “I will continue to keep you posted on significant updates, but in the meantime, thank you for your patience as we work through this on the legal side,”
In response to news of Musk’s reversal, Blind, an anonymous private forum popular among Twitter employees, was buzzing on Tuesday. Screenshots shared with CNN by a Twitter employee show that the forum’s response was largely unfavourable. A reply said, “Cue the layoffs.” Other staff members voiced their worries that Musk might scale back Twitter’s benefits, particularly the severance payments made to departing workers.