Elon Musk has finally reached a deal to buy Twitter for $44 billion.
Twitter board, Monday, reached an agreement for billionaire Elon Musk to buy the social media platform in a $44bn (£34.6bn) deal.
This was after the board’s initial refusal stance to sell the app to the Tesla CEO.
However, the transaction, which was unanimously approved by Twitter’s board, is expected to close in 2022.
Twitter announced the takeover on Monday following Musk’s offer to take over the social platform.
According to the announcement, Twitter “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,” the company said in a news release.
Commenting on the takeover, Elon Musk said he wants Twitter to be better than it is and that he would introduce new features.
By this, he means that Twitter “has tremendous potential.”
He said thus:
“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.”
“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.”
Meanwhile, CEO Parag Agrawal said of the deal thus:
“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.”
Also speaking, Twitter’s Independent Board Chair, Bret Taylor, said the board did thorough assessment of Musk to arrive at selling Twitter to him.
According to him, the company’s 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.”
The takeover deal:
Recall that Musk became Twitter’s largest shareholder in early April after buying 9.2% shares of the company.
Subsequently, in an SEC filing last week, he offered to pay $54.20 per share for 100 percent ownership of Twitter.
The billionaire gave one of his reasons for the takeover to be that he wants to take the company private.
In a letter to Twitter’s Chairman of the Board, Bret Taylor, Elon Musk had said thus:
“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.”
The billionaire went on to note that this proposal is his “best and final offer.”
Musk had threatened to reconsider his position as Twitter’s shareholder if his offer was not accepted.
Although Twitter initially gave the stance of rejecting his offer, however, confirmations have emerged that both sides were close to reaching a deal.
The Poison Pill:
Also, recall that Twitter had activated the poison pill to make it difficult for Musk to buy the company.
That policy was meant to prevent Elon Musk from increasing his stake in the company beyond 15%.
However, the poison pill failed to poison Musk as the deal seems to be closed, in favour of Musk.