Elon Musk Secures $44B Deal for Social Media Platform Twitter
Under the helm of Elon Musk, Twitter is expected to transition to a privately-held company amid new features and functions
Elon Musk | Blockworks Exclusive Art by Axel Rangel
key takeaways
- SpaceX and Tesla CEO Elon Musk has reached a deal with Twitter’s board of directors to buy the platform
- The $44 billion deal is expected to close sometime this year, subject to the approval of Twitter’s shareholders
Major social media platform Twitter said Monday it had entered into a definitive agreement to be acquired by an entity wholly owned by Elon Musk in a deal worth $44 billion.
Under the terms of the deal, Twitter shareholders are to receive $54.20 per share in cash for each share of Twitter common stock that they own, according to a press release.
The deal has been unanimously approved by Twitter’s Board of Directors and is expected to close sometime this year, subject to the approval of the platform’s stockholders.
Upon the deal’s completion, Twitter is expected to transition to a privately held company, ending its nine-year run as a publicly listed company on the New York Stock Exchange.
The buyout represents a 38% premium to Twitter’s closing stock price on April 1 — the final day Musk unveiled his 9% stake in the social media company.
Musk has secured $25.5 billion of fully committed debt and margin loan financing while providing an approximately $21.0 billion equity commitment, per the release.
A major platform for the crypto community, Twitter is often both been praised and reviled for its approach to content moderation, freedom of speech (or lack thereof) and user profile anonymity.
Musk — who is estimated to be worth upwards of $268 billion, according to Forbes — said he wanted to improve Twitter through the introduction of new features, provide an open-source algorithm for the platform and tackle its spambots.
“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,” Musk said in the release.
There are also reportedly plans to turn the platform into a subscription-based model to bolster revenue and recoup some of Musk’s initial investment, according to Reuters’ reporting.
Whether that would appease the crypto community or drive users to seek alternatives remains to be seen. Musk, whose Twitter musings about crypto — particularly Dogecoin — have resulted in the wild oscillation in prices, is often viewed as both an inflammatory and influential figure within the community.
In January, Dogecoin payments on electric car company Tesla’s online shop went live for select items. At the time, the price of Doge shot up more than 17% within a 24-hour period.
Following a purchase of $1.5 billion worth of bitcoin last year in March, Musk announced via Twitter that Tesla would be accepting bitcoin as payment for vehicles before reneging two months later, citing environmental concerns.
On both occasions, bitcoin’s price movements coincided closely with Musk’s announcements, gaining 48% and then subsequently shedding 40% two months later.
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