ELON Musk’s $44billion dollar bid to buy Twitter was accepted on April 25 but has stalled for more than a month.
Reporters and fans everywhere are trying to get inside Musk’s head as he navigates closing one of the most expensive acquisitions of all time.
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During ancient history (early April 2022), Elon Musk bought a 10% stake in Twitter, accepted a board seat, reversed his acceptance, publicly thrashed Twitter executives, and then made an unsolicited offer to buy the whole company and take it private.
Twitter executives accepted the deal, putting Musk on the hook for $44billion dollars, or $54.20 a share, to become the sole owner of Twitter.
Musk’s $44billion dollar offer was 38% above market from when he first bought into the company and Twitter’s stock has been on a backslide since.
Musk has said the deal is “on hold” and he created a stink over bot accounts on the site – he could be trying to nuke the deal or negotiate a new price.
Musk’s gripe with the amount of bot accounts likely won’t be a sufficient reason to get out of the deal – he waived his right to closely examine the agreement and could’ve sought more information about bots when he became a 10% stake holder.
But his power of wealth and the economic climate could force Twitter to come back to the negotiating table.
“The stark reality for Twitter is that no other strategic/financial bidder will come near this deal,” an analyst told CBS News.
With no other potential suitors, Twitter could have no choice but to let Musk alter the terms of the deal and lower the price.
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Musk leveraged $12.5billion dollars worth of Tesla stock to secure loans for the Twitter bid.
CBSNews reported that if Tesla’s stock drops below $420 from its current price of $782, then Musk would not be able support the loans he took to buy Twitter.
“Tesla shareholders are voicing concern over Elon [Musk] doing too many things at once,” a market expert told The Street.
“Shareholders may also be worrying that depending on what he does with Twitter, he may turn off potential car buyers.”
Musk has portrayed himself as a free speech warrior, earning scorn from liberals, who are more likely to buy electric cars.
If he wants to pull the rip cord and ditch the Twitter deal entirely, he’ll owe a $1billion dollar termination fee.
Musk has been eerily quiet about the deal as of late – he’s posted mostly memes and vague statements about happiness.
On Twitter’s end, current CEO Parag Agrawal tweeted “while I expect the deal to close, we need to be prepared for all scenarios.”
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