Elon Musk offered to complete his original offer to purchase Twitter for $44 billion.
Key Details
- As the case between Elon Musk and Twitter was nearing its court date, Elon Musk has reverted back to his original offer to buy the social media company for $54.20 a share—for a total of $44 billion.
- The two parties were set to finish the battle in court later this month, but now that Musk has agreed to pay his original offer there might be no need for the court date.
- Musk recently made the proposal in a letter to Twitter, according to people familiar with the matter and Twitter shares climbed as much as 18% in wake of the news.
Why it’s important
The battle between Elon Musk and Twitter has been brewing for many months as the billionaire attempted to step down from his $44 billion deal to buy the social media company—with some backing from individual investors such as Oracle chairman Larry Ellison and investment banks.
Musk tried to abandon the deal after saying the social media company was being dishonest about the amount of fake accounts and bots on the site.
Now that Musk has proposed to match the original deal terms means Twitter is now facing a future under the leadership of a mercurial billionaire who has spent months publicly criticizing its management and questioning its value. It also means that his claims—about how many of Twitter’s users are bots, for instance—are not likely to be scrutinized in a courtroom, according to Bloomberg writers Jef Feeley and Ed Hammond.
Backing up a Bit
The timeline between Elon Musk and Twitter is a lengthy one.
In April, Elon Musk announced that he held a 9.2% stake in Twitter, which made him the social-media company’s largest shareholder. Twitter’s stock price soared 25% after the announcement.
Later that month, the billionaire entrepreneur offered to buy all of Twitter at $54.20 per share—equaling about $44 billion. He said he originally invested in the platform because he believes it is failing in its potential to be the leading platform for free speech around the globe. In fact, he asked his 2 million followers if Twitter adhered to principles of free speech, and 70% said “no.”
Last month, Musk decided to back out of the deal, claiming there were too many fake accounts on the platform. Twitter has since sued Musk in Delaware Court of Chancery to complete the deal and requested the trial to take place in September. Musk, on the other hand, wanted to delay the trial until February 2023, stating that a case of this size takes time to prepare. Twitter was granted its wish of an expedited trial, with Chancellor Kathaleen McCormick, the presiding judge, setting a five-day trial for October. Musk then countersued Twitter, stating his reason for the termination was due to Twitter not being upfront about the number of fake accounts on the platform.
Then, Elon Musk and his legal team subpoenaed Twitter’s founder and former CEO Jack Dorsey, to get him to release documents that provide accurate information on bots and spam accounts on the social-media platform and now these documents have come out from Zatko and Musk and his lawyers have subpoenaed him as well.Lastly, Musk’s text messages were revealed in court filings and it showed that Twitter co-founder Jack Dorsey tried to facilitate Musk’s Twitter takeover.
