Billionaire entrepreneur Elon Musk agreed to buy Twitter Inc for $44 billion cash, using one of the biggest leveraged buyout deals in history to take private a 16-year-old social networking platform that has become a hub of public discourse and a flashpoint in the debate over online free speech.
“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 in a statement released by Twitter.”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.”
🚀💫♥️ Yesss!!! ♥️💫🚀 pic.twitter.com/0T9HzUHuh6
— Elon Musk (@elonmusk) April 25, 2022
Investors will receive $54.2 for each Twitter share they own, the company said in a statement Monday. The price is 38% more than the stock’s close on April 1, the last business day before Musk disclosed a significant stake in the company, sparking a share rally.
“Twitter has a purpose and relevance that impacts the entire world. Deeply proud of our teams and inspired by the work that has never been more important,” the company’s CEO Parag Agrawal said in a tweet.
Here are ten points to summarise the $44 billion Elon-Musk-Twitter deal:
1. Unanimously approved by the Twitter Board of Directors, the transaction is expected to close in 2022. With the definitive agreement, the social media giant – which has the highest numbers of users in the United States – is set to ” be acquired by an entity wholly owned by Elon Musk, for $54.20 per share,” according to an official statement.
2. In one of his first tweets as the deal was revealed, Musk, 50, who is followed by over 84 million users, wrote: “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.” The statement comes amid wide concerns among human rights groups.
3. “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,” he further said.
4. The deal has finally seen the light of the day after a spell of uncertainty. Agrawal has been quoted as saying in reports that business as usual will continue for employees and there will be no job cuts till the takeover.
5. Musk has “secured $25.5 billion of fully committed debt and margin loan financing and is providing an approximately $21.0 billion equity commitment,” says Twitter’s official statement.
6. Earlier this month, a day after Musk had revealed his purchase intentions, Twitter had adopted a limited duration shareholder rights plan, or the poison pill. Such defense moves are usual to avoid hostile takeovers.
7. The Rights Plan “will reduce the likelihood that any entity, person or group gains control of Twitter through open market accumulation without paying all shareholders an appropriate control premium or without providing the Board sufficient time to make informed judgments and take actions that are in the best interests of shareholders,” a statement said at that time, adding that it was set to expire on April14, 2023.
8. The Board adopted the Rights Plan following “an unsolicited, non-binding proposal to acquire Twitter”, it had underlined.
9. Elon Musk is known for his wide-ranging business ambitions. He had started with what is popularly known as a dream to colonise space.
10. “I hope that even my worst critics remain on Twitter, because that is what free speech means,” the Tesla CEO wrote ahead of the deal reveal. The purchase offer was reportedly accepted on Monday.