Billionaire, Elon Musk, yesterday reached an agreement with Twitter to buy the social medium for approximately $44 billion. The company confirmed that Musk acquired Twitter at $54.20 a share, the same price named in his initial offer on April 14. Musk has revealed that the motivation behind the deal is he intends to transform the platform to become a privately held company. “Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated. “I also want to make Twitter better than ever by enhancing the product with new features, making the algorithms open source to increase trust, defeating the spambots, and euthenticating humans. “Twitter has tremendous potential, I look forward to working with the company and the community of users to unlock it,” he said.
According to a report, Twitter is on the verge of accepting Elon Musk's $43 billion bid to take the social network private.
Under the terms of the agreement, Twitter stockholders will receive $54.20 in cash for each share of Twitter common stock that they own upon closing of the proposed transaction. The purchase price represents a 38% premium to Twitter’s closing stock price on April 1, 2022, which was the last trading day before Mr. Musk disclosed his approximately 9% stake in Twitter.
Twitter's stock soared more than 5% in premarket trading on Monday as a result of the Reuters report, which said that Twitter could announce that it has accepted Musk's offer later on Monday, after its board has met to recommend the transaction to Twitter shareholders.
The report also says that Twitter was unable to obtain a so-called "go-shop" provision from Musk, which would have allowed it to solicit additional bids from potential buyers after the deal was signed.
Despite this, Twitter would be able to accept an offer from another party if it paid Musk a break-up fee, according to the sources.
Musk reportedly met with several shareholders over the weekend to discuss the details of his $54.20 per share bid for the social media platform. According to the report, Musk's outreach forced the Tesla CEO's $43 billion takeover bid to be seriously considered by the board of directors.
Many Twitter shareholders contacted the company during the weekend after Musk outlined a detailed financing plan for his bid on Thursday, urging it not to let the opportunity for a deal pass them by.
Twitter's board is worried that defying its investors in the event Musk makes an attractive tender offer will weaken the company's negotiating position. According to the sources, Musk's insistence that his bid for Twitter is his "best and final" has become a stumbling block in the deal negotiations.