Huge u-turn by Elon Musk less than a fortnight before his courtroom showdown, after now agreeing to buy Twitter at previously agreed price
Tesla CEO Elon Musk is to proceed with his controversial $44 billion of purchase of micro blogging platform Twitter.
In a highly dramatic u-turn, lawyers for Musk’s legal team confirmed in a court filing on Tuesday that Musk is now prepared to go ahead with the deal he had previously walked away from, on the previously agreed terms.
The move comes after months of legal drama, and just eleven days before he was due to face Twitter in a Delaware courtroom on 17 October.
The news prompted shares in Twitter to rise over 22.2 percent on Tuesday trading, closing at $51.76 and valuing Twitter at $39.8bn.
The stunning development that Elon Musk is now prepared to set aside his concern about bot and spam numbers on the platform, and push ahead with the transaction, came after Bloomberg had reported on Tuesday that the Tesla CEO had written to written to Twitter offering to close the deal at the original price of $54.20 a share.
Musk had failed in a number of attempts to delay Twitter taking him to court to force him to honour his signed takeover agreement. Legal experts had also warned Musk stood a small chance of winning his attempt to pull out of the deal.
“We write to notify you that the Musk parties intend to proceed to closing of the transaction,” the Guardian quoted the notice, filed by Musk’s lawyers as saying.
The filing added that the adjournment of the Delaware trial and securing of debt financing are preconditions.
Twitter then confirmed the development in a cautious statement – understandable given the highly erratic behaviour of its suitor.
Twitter issued this statement about today’s news: We received the letter from the Musk parties which they have filed with the SEC. The intention of the Company is to close the transaction at $54.20 per share.
— Twitter Investor Relations (@TwitterIR) October 4, 2022
Elon Musk was relatively subdued about the matter on his Twitter account, simply saying that “buying Twitter is an accelerant to creating X, the everything app.”
Buying Twitter is an accelerant to creating X, the everything app
— Elon Musk (@elonmusk) October 4, 2022
In March this year before the buyout, Musk had criticised Twitter and said he was giving “serious thought” to building a Twitter rival.
There is ongoing media speculation that Musk will try and turn Twitter into a replica of the Chinese WeChat app, that incorporates different services such as messaging, social media, food orders, and payments etc into a single app.
In the short term however, Elon Musk acquiring Twitter will likely result in a couple of immediate changes at Twitter.
This could include the firing of Twitter CEO Parag Agrawal, after court documents revealed private messages that showed the two men had fallen out, and Twitter co-founder Jack Dorsey had sought to mediate.
The other short term development of Musk acquiring Twitter will be the likely reinstatement of the Twitter account of former US President Donald Trump.
In May Musk made no secret of his vision of ‘free speech’ on the platform (prompting content moderation concerns).
Musk at the time said he would reverse Twitter’s “stupid” ban on Donald Trump.
Donald Trump was banned on almost all social networking platforms for his role in inciting a mob of his supporters to storm the US Capitol building on Wednesday 6 January 2021, which resulted in the deaths of five people (including one police officer who was beaten to death).