Twitter’s board has changed its mind on the Tesla founder’s offer from two weeks ago after shareholder pressure.
According to a report from Reuters, Twitter is set to sell the majority of its stakeholding to Elon Musk following the Tesla founder’s initial $43 billion bid in cash. The multibillion dollar offer from Musk would value Twitter at $54.20 per share, per the Reuters report. This morning, shares of the company were valued at $51 at market open, an increase of over 3% from its close on Friday.
The offer, originally announced on April 14 via SEC filing, found that Musk had labeled the bid “his best and final offer”. In a separate report, Reuters found that Twitter had reached out to Musk about the offer following pressure from its shareholders after initially rebuffing the Space-X CEO’s purchase attempt. This impending purchase comes in response to Twitter initially deciding to employ a “poison pill” to prevent Musk from acquiring the company.
A poison pill is the process in which companies are able to fend off hostile takeover by allowing existing shareholders the right to purchase additional shares at a discount to dilute the value of the stock.
Musk said in a letter to Twitter’s chairman that he planned on taking the company private if the sale was accepted.
“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 to Twitter chairman Bret Taylor on April 13. “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 as a private company.”
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Twitter’s reaction to the sale
As was the case with the bid on April 14, reactions of those on the platform are mixed to say the least. Many are lamenting the impending sale, citing the purchase as Musk simply feeding his own ego. A number of users have also declared that they may leave the platform altogether should the Tesla CEO officially purchase the company.
When billionaires like Elon Musk justify their motives by using “freedom,” beware. What they actually seek is freedom from accountability.
— Robert Reich (@RBReich) April 24, 2022
Not sure I am interested in Twitter if Elon Musk owns it.
— John W. Dean (@JohnWDean) April 24, 2022
On the other side, some have expressed hope that the platform will become more conducive to free speech and potentially allow some previously banned users to return to the site.
BREAKING: @elonmusk offer to buy Twitter could close as early as TODAY.
What a huge win this would be for free speech.
Congratulations to my African-American brother.
— Vernon Jones For Congress (@VernonForGA) April 25, 2022
Four days ago, Obama called for full-blown censorship on social media.
Today, Twitter will accept @ElonMusk‘s offer.
Free speech lives.
Suck it, Communists.
— Monica Crowley (@MonicaCrowley) April 25, 2022
Either way, it remains to be seen what changes Musk plans on adding to the platform if the sale is finalized and the company is officially taken private.