Twitter’s board accepts Elon Musk’s US$44 billion takeover bid

NEW YORK, 26 April 2022:

Twitter Inc’s board yesterday announced it has accepted billionaire Elon Musk’s US$44 billion takeover offer for the social media platform, which is to become a privately held company upon completion of the transaction.

After a morning of much speculation about an imminent accord and a halt to the trading of its shares on Wall Street, the San Francisco-based company announced in a press release that it has “entered into a definitive agreement to be acquired by an entity wholly owned by Elon Musk for US$54.20 per share in cash.”

That payout to shareholders represents a 38% premium to Twitter’s closing stock price on 1 April 2022, the last trading day before a regulatory filing with the Securities and Exchange Commission revealed that Musk had purchased a 9.2% stake in the social media platform and become its single largest shareholder.

The 50-year-old Musk, a South African-born naturalised American citizen and self-described “free-speech absolutist” with 83.6 million followers on Twitter, has criticised the company’s content moderators for excessively intervening on the platform.

In the most widely publicized case, former US president Donald Trump had his account permanently suspended two days after the 6 Jan 2021, riot at the US Capitol.

Citing two of Trump’s tweets in which he called into question the legitimacy of the 2020 election result and said he would not attend then president-elect Joe Biden’s 20 Jan 2021, inauguration, Twitter said it had decided to suspend the account “due to the risk of further incitement of violence.”

Musk has not commented on Trump, who has launched a social media platform of his own known as Truth Social that has struggled to attract users.

A loosening of Twitter’s content moderation rules under Musk is seen as likely to lessen that start-up’s appeal.

“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, the founder of electric carmaker Tesla and aerospace manufacturer SpaceX and the world’s wealthiest individual, was quoted as saying in yesterday’s press release.

“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.”

The transaction was unanimously approved by Twitter’s board of directors and is expected to close in 2022, subject to the approval of the company’s stockholders and regulators and the satisfaction of other customary closing conditions.

Twitter’s independent board chair Bret Taylor said in the release the company’s board had evaluated Musk’s offer with a focus on “value, certainty and financing” and deemed the transaction to be the “best path forward” for the company’s stockholders.

For his part, CEO Parag Agrawal was quoted as saying in the release Twitter “has a purpose and relevance that impacts the entire world.”

“Deeply proud of our teams and inspired by the work that has never been more important.”