Update: Monday 3 p.m.
Twitter has reached a deal to allow itself to be acquired by Elon Musk for $54.20 a share, or approximately $44 billion, in an all-cash transaction, the company said Monday. The stunning announcement follows weeks of back-and-forth drama between the social media giant and the Tesla CEO.
“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,” Musk said in a statement. “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 spam bots, and authenticating all humans. Twitter has tremendous potential – I look forward to working with the company and the community of users to unlock it.”
Shares of Twitter were up at least 6% Monday as news of negotiations between Twitter and Musk trickled out. The agreement means that current shareholders will receive a per-share price that is 38% higher than Twitter’s share price before Musk announced a stake in the company on the first day of this month, the company said.
“The Twitter Board conducted a thoughtful and comprehensive process to assess Elon’s proposal with a deliberate focus on value, certainty, and financing,” Bret Taylor, Twitter’s independent board chair, said in a statement. “The proposed transaction will deliver a substantial cash premium, and we believe it is the best path forward for Twitter’s stockholders.”
The merry-go-round drama between Elon Musk and Twitter continues. Musk and Twitter are now in discussions again for the world’s richest man to take over the social media platform, according to Reuters. News of this new round of talks broke on Sunday and follows after Twitter adopted a poison pill to stop any Musk takeover.
So, what’s changed?
Twitter shareholders reportedly became more interested in a Musk takeover after the billionaire Tesla CEO assembled a $46.5 billion funding package from financiers. Reuters says the financial package doesn’t guarantee Twitter’s board will agree to a deal, but they are now considering one.
The company does still have several concerns, however. It’s worried regulators in certain markets may object to Musk buying the platform, making any deal troublesome. It also wants to be made aware of any active investigation into Musk by the Securities and Exchange Commission (SEC), which could complicate a Musk takeover, too.
Musk has offered $54.20 a share for Twitter, calling it his “best and final” offer. However, Reuters says some active longhorn Twitter shareholders want to give Twitter some time to raise the value of Twitter’s stock. If Twitter’s stock price increases, it could force Musk into offering more for the company. However, a deal could come quickly, too. Bloomberg is reporting that a deal between Musk and Twitter could come as soon as today.