Elon Musk, the CEO of Tesla, offered on Tuesday to finalize a deal to buy Twitter, reversing a months-long campaign to do so. According to Forbes, Musk is the wealthiest man in the world. Musk presented Twitter with a proposal that would close the transaction at Musk’s initial offer price of $54.20 per share for a total cost of around $44 billion, a source told ABC News.
In response to Musk’s attempt to renegotiate the terms of an acquisition deal, Twitter sued him in July. In less than two weeks, that trial is scheduled to start.
In April, Musk and Twitter struck an acquisition agreement, but in the weeks that followed, Musk expressed worries about spam accounts on the network, alleging Twitter had not given him a reliable estimate of their number. Twitter refuted the assertion, stating that it had given Musk the information in line with the terms of the purchase agreement.
In an email to ABC News on Tuesday, Dan Ives, managing director of stock research at the investment company Wedbush, said: “This is a clear hint that Musk realized coming into Delaware Court that the likelihood of prevailing vs. the Twitter board was exceedingly improbable and this $44 billion acquisition was going to be finalized one way or another.”
The action by Musk is the most recent turnabout in a story that began in January with the billionaire’s first investment in Twitter. The social media startup Twitter announced that Musk will join its board of directors in April after Musk had grown to be its biggest shareholder by March. Musk subsequently revealed, though, that he had made up his mind not to join the board.
Musk made a purchase bid for Twitter in April, valuing the business at $54.20 per share. The price difference between the offer and the pricing a day before Musk’s investment in Twitter was 38%. Ten days later, Twitter decided to accept Musk’s proposal.
But a month later, Musk said that he had “temporarily put the transaction on hold,” citing his worries about the platform’s high incidence of bot and spam accounts. After almost two hours, Musk said that he was “still committed” to the agreement.
Musk eventually made an attempt to end the agreement in July. Twitter soon after filed a lawsuit against Musk in Delaware’s Chancery Court to compel him to finish the acquisition.
In July, the court decided to conduct the trial over the course of five days in October, which seemed to be more in line with a timeframe proposed by Twitter, which had wanted a four-day trial in September. Musk requested that the experiment start no early than the middle of February 2023. If the two parties can come to an agreement, it now looks that the court case may not proceed.
Source: ABC News