Twitter, Inc. (TWTR) announced on April 25 that it had entered into a definitive agreement to be acquired by an entity owned by Elon Musk. Musk, the CEO of Tesla, Inc. (TSLA) and entrepreneur behind numerous other companies, is currently the world's richest person. The deal follows a highly publicized back-and-forth between Musk and Twitter's board of directors.
- Elon Musk, the CEO of Tesla and richest person in the world, will buy social media giant Twitter for approximately $44 billion.
- The deal marks the end of a public and often contentious back-and-forth between Musk and Twitter's board.
- Musk disclosed a roughly 9% stake in the company in early April.
History of Musk's Interest in Twitter
Musk originally disclosed a stake in Twitter of approximately 9% earlier in April, fueling speculation that he planned to influence the company. Analysts initially speculated that Musk may have sought a seat on the company's board in order to exert influence over company policies. Shortly thereafter, however, he backed out of the planned board seat and stated his intention to buy the company. Musk offered to acquire Twitter for $43 billion on April 14. On April 15, Twitter's board adopted a limited duration shareholder rights plan, known as a "poison pill," in an apparent attempt to block Musk's acquisition.
Musk's history with Twitter is complicated—in 2018, the U.S. Securities and Exchange Commission (SEC) mandated that the Tesla executive receive pre-approval for certain tweets regarding the electric vehicle maker. In March 2022, regulators said that they could subpoena Musk regarding his tweets.
Terms of the Deal and Next Steps
Financing has been a barrier to Musk's acquisition of Twitter. According to the press release announcing the deal, Musk has secured $25.5 billion in financing and is providing an equity commitment of roughly $21.0 billion.
The transaction is expected to close in 2022, subject to the approval of Twitter stockholders and pending regulatory approvals.
What is happening with Twitter and Elon Musk?
Elon Musk, the world's richest person, has entered into an agreement to buy Twitter for $43 billion and take the company private.
What will happen to Twitter?
Twitter shareholders will receive $54.20 per share per the terms of the agreement. The fate of the company is not clear, but Musk has talked about adding features including authentication of all users.
When will Elon Musk buy Twitter?
Following weeks of back and forth, Twitter's board accepted Elon Musk's acquisition offer on April 25. The deal is expected to close in 2022, but it is dependent upon Twitter shareholder approval, regulatory approval, and other closing conditions.