Last week Elon Musk announced his bid to fully acquire Twitter and take it off the stock market, and initially it seemed like the company would politely (or not so politely) decline. However, a few days later it appears as it did some more thinking and today it officially announced that it’s accepting Musk’s bid.
According to Twitter’s press release, the firm has now “entered into a final deal to be bought by an entity entirely owned by Elon Musk.” The price is $54.20 a share in cash (which, by the way, does not imply shares in SEC lingo and does not mean actual cash). As a result, the transaction’s overall worth is estimated to be around $44 billion. Twitter will become a privately held corporation and its shares will no longer be traded on any stock market after the process is completed (which could take months due to the amount of regulatory scrutiny it will face).
This was Musk’s initial plan after all, and it looks like it’s all coming together quite nicely for him. The price per stock he’s paying represents a 38% premium over Twitter’s closing stock price when its shares were last traded.
“Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated”, Musk said. “I also want to make Twitter better than ever by enhancing the product with new features, making the algorithms open source to increase trust, defeating the spam bots, and authenticating all humans. Twitter has tremendous potential – I look forward to working with the company and the community of users to unlock it”, he continued.
Musk has secured $25.5 billion in “fully committed debt and margin loan financing” and is funding the purchase with around $21 billion of his own money.
