Musk submits $41bn bid to buy Twitter
Elon Musk has submitted a $41 billion offer to by social media giant Twitter in the latest twist between the Tesla billionaire and the company he invested in just last week.
Musk and Twitter have dominated news headlines this week, after the entrepreneur bought a 9.2% stake in the company and was announced as the firm’s newest board member, only for a u-turn days later which saw Musk decline his seat at the top.
Now Musk – who is one of the world’s richest people – has revealed in a regulatory filing on Thursday that he has launched a hostile takeover of Twitter with the aim of helping the company release its “extraordinary potential”.
In a letter to Twitter’s chair Bret Taylor, Musk said the site was not thriving as a company or a tool for improving freedom of speech, and “needs to be transformed as a private company”. He also threatened to withdraw his investment in Twitter should his takeover bid fail, though he denied this was a threat.
In the US Securities and Exchange Commission (SEC) filing on Thursday, Musk said he had offered to buy all Twitter’s shares for $54.20 each – a total of $41.4bn (£31.5bn) based on 763.58m shares outstanding, according to data from the financial information provider Refinitiv.
Twitter confirmed it had received the “unsolicited” proposal from the SpaceX owner and that the board would “carefully review” it to “determine the course of action that it believes is in the best interest of the company and all Twitter stockholders”.
Twitter will review the offer with advice from Goldman Sachs and Wilson Sonsini Goodrich & Rosati, a source told Reuters. Meanwhile, Morgan Stanley is reportedly acting as financial adviser for his offer.
“I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy,” Musk wrote in the letter to Taylor.
“However, since making my investment I now realise the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.
“As a result, I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced.
“My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder. Twitter has extraordinary potential. I will unlock it.”
Despite the offer, question marks still remain over whether Musk will succeed or if Twitter’s board will fight back against the bid.
Comment from Mike Rhodes, CEO of ConsultMyApp, was dismissive of Musk’s bid: “What started out as an interesting move for both Elon Musk and Twitter with the subsequent joining and not joining of the board, his attempt now to buy Twitter outright turns what was an interesting proposal, into an utterly ridiculous and empty attention-grabbing statement.
“As Donald Trump Sr & Jr are both finding out in their own cash-heavy ways, you cannot buy success or stake in the app industry.
“It would be plain ridiculous for Twitter to accept this offer and place itself in the hands of someone who has demonstrated his sporadic nature in the past two weeks.
“Twitter is a fantastic example of an independently run and managed app that brings together the best parts of tech, social media and culture all in one. This is something that Elon will quickly learn, cannot be bought.”
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