Elon Musk and Twitter have struck a deal for the world’s richest man to buy the influential social media platform, multiple outlets reported on Monday.
The sale is for $54.20 a share, or around $44 billion (£35 billion) in total. Negotiations between the two parties stretched into the early hours of Monday morning, when it was reported that a deal could come as soon as later in the day. Twitter’s board initially met Sunday morning to discuss the potential sale.
Musk, the Tesla founder and a notorious Twitter troll, acquired 9.2 percent of Twitter earlier this month, making him the company’s largest shareholder. Twitter told employees that Musk would be joining the company’s board, but then reversed course. Days later, Musk made a play to take Twitter private, calling the $54.20-per-share bid his “final offer.” It seemed like a long shot that Twitter would accept the deal, but the billionaire last week said he had secured the financing necessary to make it happen. This piqued Twitter’s interest, to say the least.
The sale comes amid speculation that Musk has been gaming the Securities and Exchange Commission. He was 11 days late in declaring that he’d bought more than five percent of the company earlier this month, a move that allowed him to net over $150 million as he continued to buy stock before disclosing his stake, which prompted the price to rise. “I really don’t know what’s going through his mind. Was he ignorant or knowledgeable that he was violating securities law?” University of Maryland finance professor David Kass told The Washington Post.
A few weeks later, when Musk made his initial offer to take control Twitter, Mark Cuban alleged that he was “fucking with” the SEC before referencing a controversial tweet in which Musk wrote that he was taking Tesla public at $420 a share. The tweet, an apparent weed-smoking joke, led to accusations of market manipulation. Musk has made clear that he is not a fan of the regulatory commission. “I do not respect the SEC,” he told 60 Minutes in 2018. “I do not respect them.”
Following Monday morning’s news that Musk and Twitter were nearing a deal, Twitter’s share price shot up five percent. The company halted trading of its shares later on Monday in anticipation of the sale announcement. Tesla’s stock plummeted in reaction to the news.
Twitter’s’ shareholders will receive $54.20 per share, a nearly 40-percent premium from where the stock’s price sat on April 1. “The Twitter Board conducted a thoughtful and comprehensive process to assess Elon’s proposal with a deliberate focus on value, certainty, and financing,” Bret Taylor, Twitter’s Independent Board Chair, said on Monday. “The proposed transaction will deliver a substantial cash premium, and we believe it is the best path forward for Twitter’s stockholders.”
Musk has long been a vocal Twitter critic, and implied in his initial filing to take over the company that it was stifling free speech. “I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy,” he wrote. “However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.”
Twitter has suspended or banned several prominent accounts for posting misinformation and hateful content — most notably former President Trump. Musk has used the platform to smear others with false claims, as well. In 2018, after one of the divers in the rescue mission that saved 12 boys and their soccer coach from a flooding cave in Thailand criticized Musk’s plan to send a submarine into the cave, Musk called him a “pedo guy.” The diver sued Musk for defamation. Musk won the case after claiming “pedo guy” was intended an insult, not a statement of fact.
Musk was not disciplined by Twitter for the “pedo guy” tweet, but the platform in recent years has made a concerted effort to crack down on various forms of harassment. Musk, who has described himself as a “free-speech absolutist,” has said he wants to be “very cautious with permanent bans,” leading conservatives to embrace his takeover of the company. It’s unclear to what extent he will remove the guardrails and let lies and abuse run rampant on the platform, but it certainly appears that Twitter is about to get a lot more toxic.
Musk has made clear that he will lead on the First Amendment to justify any misinformation and hateful content he may allow flood the platform once he takes control. “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,” he said on Monday. “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.”