“Twitter has extraordinary potential. I will unlock it,” said the Tesla and Space X founder as he made an offer worth about $43 billion for the social media platform.
The offer is for $54.20 per share, which is reckoned to be equivalent to $43 billion, and would mean taking the company private under ownership of Musk, who says this is the only way to enact the sort of change he thinks needs to happen. Twitter is currently listed with a market cap of $37 billion.
This is the latest move in what has become a very public yet mysterious course of events. At the beginning of the month Musk bought 73.5 million shares representing 9.2% of the firm, making him the largest shareholder. Then, following a series of tweets that seemed like jabs at the platform itself, he announced that he would not be taking the board seat his massive investment would entitle him to. This left many wondering what the big idea was since it seemed implied he wanted to see some change at how the platform was run. Now they know.
In a message recorded in the SEC filing to Chairman of the Board Bret Taylor, Musk said “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. However, since making my investment I now realize 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.”
We wouldn’t normally publish large undigested chunks SEC filings but the wording of the rest of it is quite unlike anything you’re likely to read in any sort of corporate transaction:
As I indicated this weekend, I believe that the company should be private to go through the changes that need to be made. After the past several days of thinking this over, I have decided I want to acquire the company and take it private.
As I indicated this weekend, I believe that the company should be private to go through the changes that need to be made. After the past several days of thinking this over, I have decided I want to acquire the company and take it private.
- Best and Final:
a. I am not playing the back-and-forth game.
b. I have moved straight to the end.
c. It’s a high price and your shareholders will love it.
d. If the deal doesn’t work, given that I don’t have confidence in management nor do I believe I can drive the necessary change in the public market, I would need to reconsider my position as a shareholder.
i. This is not a threat, it’s simply not a good investment without the changes that need to be made.
ii. And those changes won’t happen without taking the company private.
At the time of writing there had been no response from the board as to the offer, but Musk seems to have made it clear it’s a straight up yes or no question, which again is presumably not normally how these things are done. There are reports that there is going to be an ‘all hands meeting with employees’, but whatever form it takes you can bet there’s some pretty serious chatter going on about it right now.
If the offer is accepted, Musk has made numerous references to how he thinks the platform should be run differently over the years (some now deleted), which amount to less heavy handed moderating and a greater emphasis on free speech, and he has mused on how much influence corporations have on an advertising based business model such as that which Twitter is based on. If he owns the thing outright he could presumably change all this and anything else he pleases, including changing the name to Tweet X or something should the mood take him
It’s hard to predict the outcome of course, and it’s even possible Musk expects a rejection and will subsequently sell his shares in the pursuit of some 4D chess manoeuvre to who knows what end. But even for a man of his exorbitant wealth, surely you don’t stick $43 billion on the table without properly weighing up the consequences of a wide eyed board saying ‘yes please Elon’ and pocketing it before you can say ‘open source algorithm’.
This being a story about Twitter, here’s some choice cuts on the matter to leave you with.
I made an offer https://t.co/VvreuPMeLu
— Elon Musk (@elonmusk) April 14, 2022
* TWITTER WILL HOLD AN ALL HANDS MEETING WITH EMPLOYEES AT 2PM PACIFIC TO DISCUSS MUSK OFFER -SOURCE@reuters $TWTR
— Carl Quintanilla (@carlquintanilla) April 14, 2022
To help Twitter’s board stay focused during their deliberations, Elon will have a Falcon 9 hover over the Twitter HQ for the next several days
— Ashlee Vance (@ashleevance) April 14, 2022
Musk is offering $54.20 per share. Twitter’s shares hit $70 less than a year ago. So Twitter’s board may reject this – while Musk still gets to enjoy a public stunt.
— Tim O’Brien (@TimOBrien) April 14, 2022
Why settle for a board seat when you can own & control the entire thing? https://t.co/YeTRPcRty5
— Sherrilyn Ifill (@Sifill_LDF) April 14, 2022
Like everyone, I have no idea what Elon Musk’s intentions are with Twitter.
But what I know for sure – having seen it first-hand with Substack, Rumble, Callin – is that few things are more urgent than platforms devoted to free speech and discourse, rejecting messaging control. https://t.co/YaB2VppcsH
— Glenn Greenwald (@ggreenwald) April 14, 2022
Image credit: YouTube.
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