NEW YORK – Twitter Inc. is set to sell about $ 43 billion in cash to Elon Musk, with Tesla Inc.’s chief executive calling his “best and final” offer for the social media company, according to people familiar with the matter.
Twitter’s board may announce a $ 54.20-share deal later Monday to recommend transactions to Twitter shareholders, sources said. It is always possible that the contract was broken at the last minute, the source added.
According to a Forbes list, the world’s richest man, Mask, is in talks to buy Twitter in private, and Tesla is not involved in the deal.
Twitter has not yet been able to secure a ‘go-shop’ provision under its agreement with Mask that would allow it to make other bids once the agreement is signed, sources said. Still, Twitter will allow Mask to accept a proposal from the other party by paying a break-up fee, the source added.
As the matter is confidential, the sources requested not to be named. Twitter and Mask did not immediately respond to requests for comment.
Twitter shares rose 4.5% to $ 51.15 in pre-market trading in New York on Monday.
Musk says Twitter needs to be taken personally to become and grow a real platform for freedom of speech.
The agreement comes just four days after the unveiling of a financing package to support the Musk acquisition. It told Twitter’s board to take the deal more seriously and not to let many shareholders miss the opportunity to make a deal, Reuters reported on Sunday.
The sale will represent an acknowledgment by Twitter that its new chief executive Parag Agarwal, who took the helm in November, is not creating enough traction to make the company more profitable, despite the company meeting its ambitious financial targets for 2023. Shares of Twitter recently traded higher than Musk’s offer price in November.
Musk’s negotiation strategy – making a proposal and sticking to it – is similar to that of another billionaire, Warren Buffett, acquisition negotiations. When Musk first published his offer for Twitter, he did not provide any funding details, leaving the market skeptical.
(Reporting by Greg Rumeliotis in New York; Editing by Mark Potter)