Elon Musk has gone from Twitter’s largest individual shareholder to would-be board member to unsolicited bidder to unwilling buyer
For context, Elon Musk agreed in April to purchase Twitter for $54.20 per share or around $44 billion. However, Twitter’s value sank in the following months, along with other tech stocks and the wider tech market.
This caused Twitter’s team to sue Musk and have him abide by the deal, with the trial scheduled to begin in less than two weeks. The company now has a say in accepting Musk’s renewed offer or forcing him to go to court to seal the deal.
Musk’s legal team clarified that the offer is only good if Twitter drops its lawsuit. Their spokesperson hasn’t provided details on which decision they’ll make. They sent a letter to Twitter Monday, which could possibly mark the end of the drama over the merger.
Musk also tweeted to his 107 million followers that he’d be creating X, the everything app. A leaked conversation of Musk and Jack Dorsey also seemed to point towards collaboration among both tech giants.
Musk allegedly did not possess the liquidity to purchase the firm straight away. He’d have to sell off some of his shares in Tesla to purchase Twitter. Selling Tesla shares might seem easy on paper, but the Tesla investors were iffy about the strategy.
Thus, the courtroom drama caused Musk to look for an exit strategy, and not a week had passed and both Twitter’s team and Musk’s team had to face each other in court. Twitter now wanted to force the sale through, as there was a $1bn termination fee at stake for either party if they walked away.
Twitter had never put itself for sale, but their team now needed to force Musk to purchase it in light of its struggling business. It was buying it, start a competing social network, or join its board, according to Twitter’s lawsuit.
The trial was set to take place in October 17, and was going to involve some of the biggest names in tech, including Twitter boss Parag Agrawal.
Musk had used his Twitter account to mock the company, attack its executives and keep the world on their toes regarding his next more. Musk’s hot and cold dynamics in negotiation have made Twitter investors wary of his actions.
Finally, a spokesperson for Twitter stated the firm had received the proposal and that they had intention of closing the transaction at $54.20 per share. This caused Twitter’s shares to skyrocket more than 20%, to more than $52 a piece. For comparison, Twitter shares had been trading below $43 a piece.
For Musk, Twitter seems like a stepping stone into developing X, the everything app.