Elon Musk made a “best-and-final” offer to purchase Twitter Inc.. He said the company had extraordinary potential and that he would unlock it.
The world’s wealthiest man will offer $54.20 per share of cash. This is a 54% premium on the Jan 28. closing prices and a total value of approximately $43 billion. The shares of the social media company soared 18%.
Musk, 50, made the announcement in a filing to the U.S. On Thursday, the Securities and Exchange Commission announced Musk’s offer in a filing with the U.S. The billionaire also owns Tesla Inc.. On April 4, he disclosed a stake in the company of around 9%. Pre-market trading for Tesla shares dropped by 1.5% on the news.
This executive is one the most watched on Twitter, tweeting memes and taunts frequently to @elonmusk’s over 80 million followers. After the company announced his stake, he was open about the changes he would like to see at the social media platform. He was offered a seat on its board.
Musk immediately made a public appeal to his fellow users to discuss possible moves. These included converting Twitter’s San Francisco headquarters to a shelter for homeless people, adding an edit button to tweets, and granting premium users automatic verification marks. Twitter may be dying according to one tweet. This is despite the fact that many celebrities have high followings but rarely tweet.
Musk is able to afford a takeover. According to Bloomberg Billionaire Index, Musk is worth approximately $260 billion. This compares with Twitter’s current market value of $37 billion.
Musk wrote a letter to Twitter’s board stating that he believes Twitter will not thrive or serve its free speech societal imperative in the current form. Twitter must be transformed into a private company.
It is unlikely that the takeover will be prolonged. Musk stated that if the deal fails, Musk would have to reconsider his position as shareholder. He said, “Given that I don’t have confidence or ability to drive the necessary changes in the public markets, and I don’t believe the management will let me down, I wouldn’t be able to make the deal work.”
According to Vital Knowledge’s Adam Crisafulli, the $54.20 per share offer was “too low” and unacceptable for shareholders or board members to accept. He also stated that shares were $70 lower than last year.
For the takeover, Musk has appointed Morgan Stanley to be his advisor. The offer price also includes the number 422, widely known as a coded reference for marijuana. He also chose $420 to be the share price to possibly take Tesla private in 2018, an action that drew scrutiny from the SEC.