Twitter on Monday accepted Elon Musk’s offer to buy the company for roughly $44 billion.
This comes as the Tesla earlier this month offered to buy Twitter for $43 billion in cash after acquiring a 9.2% stake in the company. Twitter’s board of directors previously “unanimously adopted a limited duration shareholder rights plan” after the unsolicited offer from Musk this week to acquire the company.
“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,” Twitter CEO Parag Agrawal said in a statement.
Twitter’s board unanimously approved the transaction that is expected to close in 2022, subject to the approval of Twitter stockholders and regulators. Musk has secured $25.5 billion of fully committed debt and margin loan financing and is providing an approximately $21.0 billion equity commitment, the company said in a statement. The purchase price represents a 38% premium to Twitter’s closing stock price on April 1.
Bret Taylor, Twitter’s independent board chair, added, “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.”
Twitter’s board earlier this month approved plans for a rights plan in an attempt to fight Musk’s takeover of the company. Known as the “poison pill,” it is a tactic companies use in hostile takeovers to let it offer new shares or shares at a discount to other buyers and shareholders.
Media Matters for America, a liberal non-profit watchdog group, swiftly responded to the news of Musk’s purchase of Twitter, warning that it “will open the floodgates of misinformation, hate and lies,” and that “accountability now rests with Twitter’s advertisers, Apple’s App Store.”
“Elon Musk will unwind a whole range of very basic protections against harassment, abuse, and disinformation that Twitter has spent years putting into practice — effectively opening the floodgates of hate and lies and using Twitter’s position as a market leader to pressure other social media companies to backslide,” its statement reads.
“Musk may claim that this is about freedom of speech, but don’t be fooled — this is about ideology. Musk made that clear himself when he talked about his desire for liberals and others to become ‘red pilled.’ Now, with control of Twitter, he has a massive tool to distribute those red pills. This is radicalization,” it continues. “With this sale, you can fully expect Donald Trump’s account to be restored along with a whole host of other accounts that engaged in abuse, harassment, and repeated violations of Twitter’s rules. The race to the bottom begins.”
“But all hope is not lost. Accountability now rests with Twitter’s top advertisers, who need to make it clear that if Twitter becomes a free-for-all of hate, extremism and disinformation — they will walk,” it concludes. It is also critical that Google and Apple hold Twitter to the same standards they applied to other apps like Parler — reiterating that Twitter will not get special treatment and that a violation of their terms of service will result in the platform being removed from the app stores.”
