Elon Musk bought Twitter for 44 billion

Billionaire entrepreneur Elon Musk has agreed to buy Twitter for $ 44 billion, using one of the largest leveraged buyout deals in history to take over a 16-year-old social networking platform that has become a flashpoint and center of public discourse. Freedom of speech

Investors will receive $ 54.20 for each Twitter share they own, the company said in a statement Monday. The price is 38% higher than the stock close on April 1, the last trading day before Musk revealed a significant stake in the company, giving rise to a stock rally. Twitter shares were suspended for this news.

Musk, one of Twitter’s most widespread users with more than 83 million followers, began gaining about 9% stake in January. By March, he had stepped up his criticism on Twitter, alleging that the company’s algorithms were biased and cluttered feeds with automated junk posts. He suggested that Twitter users be inflated by growth bots. After rejecting an invitation to join the company’s board, he offered to take Twitter private on April 14, saying he would make the platform a base for freedom of speech and leave out other hints about the changes he would make as owner.

Ideas have slipped from practicality – say, allowing users to edit tweets and fight the spread of bots – as strange as the company’s proposal to turn its San Francisco headquarters into a homeless shelter.

“Freedom is the foundation of a functioning democracy, and Twitter is the digital town square where important issues for the future of humanity are debated,” Musk said in a statement on Monday. “Twitter has tremendous potential – I look forward to working with companies and the community of users to unlock it.”

The deal was unanimously approved by the company’s board and is expected to be completed by the end of this year. According to the statement, Musk secured $ 25.5 billion in debt and margin debt financing and would provide approximately $ 21 billion in equity to finance the deal.

Privatization marks a dramatic change for a company that started out as a messaging service to share your status updates with friends, but has quickly become a way to broadcast short posts of 140 characters or less to public followers. Twitter ignites politicians, celebrities and journalists, and social media stalwart replaces Facebook and YouTube as an ideal carrier of a new, more interactive way of using the web known as Web 2.0.

Since its birth in 2006, the company has faced a number of crises, including a management crisis, including the removal of co-founder Jack Dorsey in the early days of Twitter and his return in 2015. After an initial public offering in 2013, the company considered selling. In 2016, Disney itself created the company’s interest in Salesforce. Dorsey teamed up with an active investor in 2020 that forced Twitter to set specific growth targets and add greater board responsibilities. This served as a catalyst for Dorsey’s second exit so that he could focus on his other company, the digital-payment company Block, Inc.

As recently as last week, there was little clarity about whether Mask’s bid would be successful. The 50-year-old billionaire thought of himself at a TED event the day it was announced that he even had doubts about his chances. Although the stock initially jumped on news of Musk’s stake in the company, shares have traded below the original offer price of $ 54.20 since the announcement – a sign investors were skeptical a deal would work out.

Twitter adopted a shareholder rights plan on April 15 – a measure known as poison pills – to prevent unwanted bidders. The plan is applicable if a party acquires 15% of the stock without prior approval and anyone who takes control of the social media company through open market savings tries to ensure that all shareholders pay a reasonable control premium, the company said at the time of releasing the plan. .

But a turning point came last week when Tesla merged a financing plan that included 12 banks, led by CEO Morgan Stanley. Just days after the plan was unveiled, Musk met with Twitter officials as the company became more receptive to a deal, a source familiar with the matter told Bloomberg News on Sunday.

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