One of the biggest deals in the world of tech just took place. Billionaire entrepreneur Elon Musk buys Twitter in a $44 billion deal. The deal will take the company private with shares valued at $54.20, 38% over the price at the time when Elon offered the deal.
Elon called the bid he made on April 14th his “best and final offer”. Elon Musk tweeted this to his 85+ million followers as the deal went through.
He also tweeted in support of free speech by extending a warm welcome to his worst critics to remain on Twitter.
How the story panned out
The saga started when Elon Musk announced that he bought a 9.1% of stake in Twitter. Elon was then invited to the board of Twitter. A few days later he opted not to join the board. And then by April 14th, he made a “best and final offer” at $54.20 to buy the shares of Twitter and take it private. By April 21st, he announced he has the funding secured.
The offer became more concrete after Musk announced in an SEC filing that he has secured the funding for $46.5 billion. The financing includes about $25.5 billion in debt financing from Morgan Stanley Senior Funding and other firms. The other $21 billion is coming through equity financing.
His initial bid was countered by Twitter with a “poison pill defence”. Poison pill defence is a tactic used where the target offers existing shareholders the right to purchase additional shares at a discount, except for the acquirer. This dilutes the share of the acquirer thereby making it more expensive for them to acquire the company.
In response to that, Musk met privately with several shareholders of the company and explained his vision for the company. This became more serious after he secured the funding. The board went into more negotiations with Elon Musk and met on Sunday to evaluate the offer. The deal was, later, unanimously approved.
Jack Dorsey, the co-founder of Twitter approved of the deal with this tweet thread.
Jack Dorsey also approved of Elon’s approach to fixing Twitter’s problems. He said he believes the step is in the right direction by taking Twitter back from Wall Street and ads. Dorsey stepped down as CEO of Twitter in November 2021 and gave the reins to India-born American Parag Agrawal. Dorsey criticized the company’s board over its “dysfunction” after they did not respond positively to Musk’s offer.
According to CNBC, Dorsey is planning to leave the Twitter board this year. But now with Elon Musk buying Twitter, he may return to the company in some capacity. In 2019, Dorsey had named Musk his favourite Twitter user.
The current CEO Parag tweeted this.
It did not have a lot of information on how the company is dealing with it. But in an internal message to employees, he mentioned that he will be holding an all-hands meeting. He acknowledged this deal is a significant change and he wants to talk about how this will affect the employees.
Musk has already mentioned his goals with Twitter after the acquisition. He tweeted recently that if his
Twitter bid succeeds, he will focus on defeating the spambots. He also mentioned that he would want all the humans on the platform authenticated. Musk also mentioned that he will work on the bring the “Edit” button to the social media platform. He, in fact, ran a poll if users needed a Twitter Edit button, which got over 2M votes with an overwhelming yes.
Musk has also stressed that his goal is to protect free speech and work toward unlocking twitter’s extraordinary potential.
We are totally excited to see how this plays out. What are your thoughts on this?
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