Elon Musk has made a hostile bid on Twitter with an offer that values the company at $ 43.4 billion, though he acknowledged that his bid to take the social media platform private may fail.
Musk’s offer of $ 54.20 per. share comes days after he took over a 9 percent stake in the company and became its largest shareholder, but declined an invitation to join the board.
The move would transform the tech entrepreneur into a social media baron who is capable of setting the future direction for a platform where he has 80 million followers and which he has used to pursue personal vendettas and promote his agenda.
The entrepreneur announced the offer Thursday in an application to the U.S. Securities and Exchange Commission, saying he would “unlock” the company’s potential to be “the platform for free speech across the globe.”
Speaking at the TED conference in Vancouver on Thursday after the announcement, Musk said he had “sufficient assets” to fund the deal, but admitted: “I’m not sure I’ll actually be able to acquire it. “
He said he intended to retain “as many shareholders as the law allows in a private company,” insisting he did not want to “monopolize” or “maximize” his Twitter ownership.
“I do not care about the economy at all,” he said. He added that he had a “plan B” if the bid was not successful, although he did not elaborate further.
Musk’s offering represents a 38 percent premium to Twitter shares since April 1, three days before his shareholding went public, although it is still 26 percent below the highest level in 12 months, reflecting a decline in Wall Street confidence, before entering.
He suggested he could walk away if the deal fell through.
“My offer is my best and final offer, and if it is not accepted, I will have to reconsider my position as a shareholder,” Musk wrote.
Shares of Twitter closed 1.68 percent at $ 45.08.
In his TED interview, Musk said Twitter should “match the laws” of each country, adding: “I think we will be wrong if we are in doubt, let the speech exist … if it is a gray area , I would say, let the tweet exist. ”
When asked about his plans for the company, whether he succeeds in buying it, Musk said Twitter should avoid deleting postings, and advocated for “time-outs” over “permanent bans” – an attitude that ultimately could pave the way for a return of banned figures, such as former US President Donald Trump, to the platform.
He also said he would prioritize eliminating spam and bots from Twitter, the open source platform’s algorithm and introducing more transparency when users’ tweets are boosted or suppressed in their feed.
I made an offer https://t.co/VvreuPMeLu
– Elon Musk (@elonmusk) April 14, 2022
Twitter said its board of directors “will carefully review the proposal to determine the approach it believes is in the best interests of the company and all Twitter shareholders”.
The company is considering implementing a “poison pill,” a mechanism that could be used to dilute an enemy investor’s stake, to thwart Musk’s bid, according to a person informed of internal Twitter discussions.
In a tweet, Saudi business magnate Prince Alwaleed bin Talal said he, as one of Twitter’s biggest long-term shareholders, rejected Musk’s takeover bid. The prince added that he did not think the offer “comes close to Twitter’s intrinsic value given its growth prospects”.
Musk’s bid comes after a few days of whirlwinds for the company, which has shaken its leadership and its staff.
Musk acquired its shares on March 14, but did not publicly report the share until April 4, exceeding the 10-day limit required by federal trading laws for investors to notify the SEC.
Following the news that Musk has become Twitter’s largest shareholder, the company’s shares rose by 27 percent. A day later, Musk reached a preliminary agreement with the company to join the board, only to suddenly turn the course without explanation, after spending the weekend criticizing the platform and proposing new features in tweets that have since been deleted.
A tweet that Musk has “liked” on the platform suggested that he “became the biggest shareholder for Freedom of Expression” and was told that he should play nicely and not speak freely.
Tesla’s CEO used Twitter to announce his intentions to take the electric car maker private in 2018 in a post that said, “I’m considering taking Tesla private for $ 420. Funding secured.”
The proposal was abandoned a few weeks later after discussions with shareholders.
Musk and the automaker paid a fine to the SEC in a settlement after being accused of securities fraud over the post. A corporate lawyer is now required to approve all tweets from Musk that contain information material for Tesla – a decision he is trying to overturn.