Throughout this blog’s coverage of Elon Musk’s back-and-forth courtship of Twitter, I remained skeptical about the Tesla billionaire’s chances of buying the censorious social network. After all, Musk has expressed openness to letting infidels air their blasphemies against the Death Cult. Up to this point, the cultists have preferred to detonate their captured platforms rather than let them fall into unclean hands.
But it looks like the status quo has changed, if breaking reports are to be believed.
Elon Musk is about to own Twitter
An accurate pun, whether intended or not.
Twitter is reportedly planning to accept Elon Musk’s offer of $43 billion to buy the company as early as Monday. The Wall Street Journal reported that the two sides “worked through the night” in order to finalize the details. Musk initially made his bid on April 14th, calling it his “best and final offer” at the time. The deal will be valued at $54.20 a share.
At first, it seemed unlikely that Twitter would allow Musk to complete his hostile takeover. It was unclear if the Tesla CEO even had the funds to buy the company in the first place. Even if he did, the board adopted a “poison pill” that would make it difficult for Musk to increase his stake much beyond the 9.2% that he already owns.
According to the Journal, Musk is planning to spend $21 billion of his own money. In order to gather these funds, he will likely need to sell stakes in his other businesses, such as Tesla and SpaceX. The other $25 billion will come from investment banks.
As WSJ points out, the company did change its tune when the stock price began to climb. The deal had seemed dead on arrival, but the company was suddenly open to negotiations. Musk then made a series of video calls to select shareholders to pitch them individually. He argued that Twitter won’t be able to reach the stock price he is offering without him.
Reading between the lines, the rise in Twitter’s stock price isn’t the proximate cause of the board’s 180. It’s what that stock bump signifies. The board has a legal obligation to maximize value for investors. Musk has now demonstrated beyond a shadow of a doubt that no one can add more value to Twitter than him. At this point, the board knows that if they don’t sell to Musk, their investors will launch a class action suit and take them for everything in a slam dunk court win.
Don’t pop the champagne just yet. Twitter could try selling to another buyer, though it’s unclear who could make a better offer. A more likely spoiler tactic would be the feds stepping in and thwarting the deal based on trumped-up charges of financial shenanigans.
Even if the deal goes through – which looks more and more likely by the minute – there’s no guarantee that Musk can restore Twitter to its 2014 Wild West glory.
As usual, all we can do is wait and see.
Here’s a fun giant robot book to read while you’re waiting.
