Elon Musk wants to buy Twitter, even if it isn’t for sale.
The world’s richest man launched a hostile takeover bid of the social media company, offering to pay $54.20 per share in cash, which would value the company at about $43 billion dollars. That’s well above Twitter’s current market capitalization, but below its all-time high, reached nearly 14 months ago.
Musk said the figure was his “best and final offer.”
“I am not playing the back-and-forth game,” Musk said in his proposal. “I have moved straight to the end.”
“Twitter has extraordinary potential,” he added. “I will unlock it.”
The news was revealed in a Securities and Exchange Commission filing on Thursday. Twitter said it received the “unsolicited, nonbinding proposal” and would review it. The company’s stock soared during pre-trading hours Thursday morning. It was up about 4% by the opening bell.
Earlier this month, Musk revealed that he purchased 9% of the company and agreed to join its board, which would have prevented him for attempting a takeover.
But Musk soon backpedaled and rejected the board seat.
“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 said in a letter sent to the chair of Twitter’s board on Wednesday.
“However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form,” he wrote. “Twitter needs to be transformed as a private company.”
“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,” Musk added.
The Wall Street Journal reports:
The Tesla CEO, with more than 80 million followers on Twitter, has long been one of Twitter’s most prominent users and, at times, one of its most vocal critics. A self-described “free speech absolutist,” Mr. Musk has publicly encouraged the platform to allow a wide range of opinions.
The series of tweets over the weekend by Mr. Musk, taken together, targeted the core of Twitter’s business, seemingly suggesting the company shut down its headquarters and cut staff while shifting from an ad-based business to one that depends more upon subscriptions to survive.
“The power of corporations to dictate policy is greatly enhanced if Twitter depends on advertising money to survive,” Mr. Musk said in a tweet that was later deleted.
WSJ adds:
Some analysts said Mr. Musk could influence Twitter to ease up on content moderation or reinstate users, such as Donald Trump. The company banned the account of the then-president in January 2021, citing what it said was a risk of incitement to violence. That move drew sharp criticism from Mr. Trump and some of his supporters.
Such changes could spur user growth and engagement if more users come onto the service and more debates are sparked, but it could also scare away advertisers, analysts have said.
Bloomberg notes:
Musk has hired Morgan Stanley as his adviser for the bid. The offer price also includes the number 420, widely recognized as a coded reference to marijuana. He also picked $420 as the share price for possibly taking Tesla private in 2018, a move that brought him scrutiny from the SEC.
