In an announcement that many of us thought we’d never get to say, it’s my joy to announce that Elon Musk, the famed CEO, innovator, and Twitter troll, just bought Twitter. As Paul Bemer said of Saddam in 2003, “ladies and gentlemen, we got him.”
Yes, that’s right; for the titanic, so large it’s hard to comprehend sum of $44 billion, Elon Musk just bought Twitter, paying $54.20-per-share in a deal that was reached sometime on Monday, April 25th. So not only was Elon able to buy the social media company, but he was able to do while also working in the same weed joke ($4.20) that he was able to work into his (in)famous “funding secured” tweet about taking Tesla private.
Regardless of the joke involved, it does appear that deal has gone through, as Reuters reported on Monday afternoon that:
Elon Musk clinched a deal to buy Twitter Inc (TWTR.N) for $44 billion on Monday in a transaction that will shift control of the social media platform populated by millions of users and global leaders to the world’s richest person.
Discussions over the deal, which last week appeared uncertain, accelerated over the weekend after Musk wooed Twitter shareholders with financing details of his offer.
Yet better, the deal Elon struck will make it hard, or at least financially painful for it to break off the deal and sell to another buyer, as it was unable to secure a so-called “go-shop” provision for the deal, a provision that would, as the name implies, let it solicit higher bids to try and nudge out Musk and sell to someone else.
It did, however, reportedly secure a provision that will enable it to accept a higher offer if it receives one without soliciting it so long as it pays Elon a fee in return. Breitbart, reporting on that provision, noted that:
Nonetheless, Twitter is still allowed to accept an offer from another party by paying Musk a break-up fee, added the sources, who requested anonymity, given that the matter is confidential.
Up until this morning, it appeared that a deal might not be struck, as Elon has made jokes both about going around the board with a tender offer and about giving up on the project entirely, both of which have raised blood pressures on the Twittersphere and likely in board rooms around the country.
But, then, this morning news broke that Elon and Twitter were close to reaching a deal, with one likely to be announced at some point on Monday. Now it appears Elon has succeeded.
What changes Elon will bring to the platform are unclear, assuming the deal goes through without another buyer swiping the social media giant from Elon, but cries on Twitter for him to bring back Trump are growing in intensity.
Who do you want Elon to bring back? Comment below!
Here’s what the press statement says:
Twitter, Inc. (NYSE: TWTR) today announced that it has entered into a definitive agreement to be acquired by an entity wholly owned by Elon Musk, for $54.20 per share in cash in a transaction valued at approximately $44 billion. Upon completion of the transaction, Twitter will become a privately held company.
Under the terms of the agreement, Twitter stockholders will receive $54.20 in cash for each share of Twitter common stock that they own upon closing of the proposed transaction. The purchase price represents a 38% premium to Twitter’s closing stock price on April 1, 2022, which was the last trading day before Mr. Musk disclosed his approximately 9% stake in Twitter.
Bret Taylor, Twitter’s Independent Board Chair, said, “The Twitter Board conducted a thoughtful and comprehensive process to assess Elon’s proposal with a deliberate focus on value, certainty, and financing. The proposed transaction will deliver a substantial cash premium, and we believe it is the best path forward for Twitter’s stockholders.”
Parag Agrawal, Twitter’s CEO, said, “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.”
“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,” said Mr. Musk. “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.”
Transaction Terms and Financing
The transaction, which has been unanimously approved by the Twitter Board of Directors, is expected to close in 2022, subject to the approval of Twitter stockholders, the receipt of applicable regulatory approvals and the satisfaction of other customary closing conditions.
Mr. Musk has secured $25.5 billion of fully committed debt and margin loan financing and is providing an approximately $21.0 billion equity commitment. There are no financing conditions to the closing of the transaction.
For further information regarding all terms and conditions contained in the definitive transaction agreement, please see Twitter’s Current Report on Form 8-K, which will be filed in connection with the transaction.
First Quarter 2022 Earnings Results
Twitter plans to release its first quarter fiscal year 2022 results before market open on April 28, 2022. In light of the pending transaction announced today, Twitter will not hold a corresponding conference call.
Goldman Sachs & Co. LLC, J.P. Morgan, and Allen & Co. are serving as financial advisors to Twitter, and Wilson Sonsini Goodrich & Rosati, Professional Corporation and Simpson Thacher & Bartlett LLP are serving as legal counsel. Morgan Stanley is acting as lead financial advisor to Mr. Musk. BofA Securities and Barclays are also acting as financial advisors. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel.