Elon Musk offers to buy Twitter for $40bn
Elon Musk has made an audacious proposal to buy Twitter for more than $40 billion in order to unleash its “amazing potential” for promoting free expression and democracy around the world. In a regulatory filing, the Tesla CEO and the world’s richest man claimed that he had launched a hostile takeover of Twitter just days after purchasing a 9.2 percent share. He was then given a position on the board of the social media firm but declined due to a last-minute twist.
Musk wrote to Twitter’s chair, Bret Taylor, saying the site “needed to be converted as a private corporation” since it was neither thriving as a firm nor a vehicle for improving freedom of speech.
According to statistics from financial information provider Refinitiv, Musk said in a filing with the US Securities and Exchange Commission (SEC) on Thursday that he had offered to buy all of Twitter’s shares for $54.20 each, for a total of $41.4 billion (£31.5 billion). That share offer price would be 54% more than Twitter’s closing price on January 28, the day before he began buying up his shares. On hearing about the offer, Twitter’s stock rose 11% to $50.90 in pre-market trade on Thursday.
“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 realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed into a private company.
“As a result, I’m offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I started investing in Twitter, and a 38% premium over the day before my investment was publicly publicized.”
“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.
Musk, who is worth an estimated $274 billion, is one of the few persons with enough cash on hand to bankroll a private purchase of Twitter. Morgan Stanley, a financial services and investment bank, has been appointed to advise him on the acquisition offer.
The $54.20 offer price includes the number 420, which looks to be a reference to the cannabis-related code. Musk offered to acquire the shares he didn’t already own for $420 a share when he proposed to take Tesla private in 2018, saying he had “financing secured” for the deal.