UPDATE: Twitter has agreed with Elon Musk’s proposal to close a sale at their original $54.20-per-share price, which values the company at $44 billion.
The agreement was reached at the edge of a legal dispute between Tesla founder and Twitter. Both have been in a constant state of conflict since Musk’s initial flirtation with the idea of buying the social media giant. Musk scheduled to be deposed later this week and an Oct. 17 trial date was imminent, so he sent a letter overnight to Twitter in which he suggested they proceed with the same terms as the summer.
Twitter took Musk to court to enforce these terms. It responded within hours:
Twitter stock shot up 22%, and was on the rise as trading closed Monday. It started the day just under $43, then shot up 18% at news of Musk’s offer, to over $48. Twitter confirmed midday that a deal had been reached. The stock then rode another rocket stage to $52, and stood at market close.
Musk had not yet tweeted any reaction as of this update, though he did respond to the founder of Dogecoin’s tweet about government spending with a laughing face emoji.
Twitter’s board has already voted to approve the sale, and Musk has secured the funds. However, there are multiple factors that could affect the timing of a formal closure. First, Delaware’s chancery court must approve to dissolve their case. Then, federal regulatory hurdles may be imposed. But as Musk doesn’t control any similar media or tech businesses, a private sale could get whisked through those hurdles in a matter of days or weeks.
Though Musk plans to take Twitter private, he’s hardly shrouded his hopes and intentions for the platform. He’s spoken repeatedly about throwing back the curtains on the site’s algorithms and relaxing censorship, with exceptions for spam accounts and explicit calls for violence.
Previously …
Multiple media outlets reported Tuesday that Elon Musk proposed to close a deal to purchase Twitter at the original price of $54.20 per shares, after months of negotiations and nearing a legal battle.
Musk sent an overnight letter confirming the concession to the company, which would bring it to $44 billion. This is after weeks of trying unsuccessfully for a contract. Bloomberg NewsAnd The Washington PostEach cited copy of the letter.
Musk purchased Twitter in April. However, he quickly retreated saying that he was misled by the amount of Twitter’s advertising revenue. “bot”There are many accounts on the social media platform. Twitter – resistant to sale at first, then unable to satisfy Musk’s inquiry – sought to enforce the purchase agreement in what was shaping up to be a court battle set to begin Oct. 17.
Presuming Twitter doesn’t change its mind again (and absent any underlying shenanigans), Musk’s willingness would clear the way for a transaction, pending any remaining regulatory clearance. Twitter is considering the proposal and will take at least a full day before responding – which speaks to the distrust that has mounted between the two sides – a person familiar with the situation SubmittedThe Post.
However, the amount of thrashing about in the Musk-to-buy-Twitter deal certainly doesn’t speak to an imminent, or clean, resolution.
Twitter’s leadership and employees pitched an internal fit when the billionaire Tesla and Space X founder first expressed interest in a purchase, including his move to buy a 10% stake in the social platform, making him the largest shareholder. Musk has criticized the platform’s censorship policies, management and the authenticity of its user base from the get-go, and Twitter at first was publicly allergic to the idea of submitting to his influence.
But Twitter began warming up to Musk’s proposal as the board came to terms with the financials and met with Musk. It is likely that Musk was not satisfied with the level of transparency regarding the percentage of “bot”Musk withdrew the agreement in July from accounts on the platform. He claimed that the terms of the agreement had been violated.
With that, Twitter’s reversal was also complete.
The company, arguing that the mercurial billionaire used the bots issue as a screen for his buyer’s remorse, sought to enforce the contract in court, where lawyers for both sides have been plastering one another with subpoenas and arguments ever since. Parag Agrawal, the CEO of Twitter, and Musk were scheduled to appear in court this week for depositions.
Twitter shares were suspended Tuesday after the report showed that they had jumped more than 18%.
