Taking Twitter private, Musk did not join The Twitter board, originally wanting to be the boss

Knife horse

Musk bought Twitter's stake to become its largest shareholder, and according to the regulations, he can enter the Twitter board, but under Twitter's "invitation", Musk refused. It turned out that Musk bought Twitter's shares not to enter the board, nor was it as speculated, Musk took the opportunity to enter the board to reorganize Twitter. Instead, Musk's ambition is even greater, is to directly "end" the board of directors of Twitter, completely privatize Twitter, and then directly become the boss of Twitter.

Musk "shouted" and privatized Twitter as "barbarian"

Originally, it was Twitter's "big V", but Musk obviously didn't just want to be a "big V", but wanted to be the boss of Twitter. Starting jan. 31 of this year, Musk continued to increase his stake in Twitter for two and a half months until he collected 9.1% of the shares and became Twitter's largest shareholder.

After becoming the largest shareholder, Musk did not "close", after refusing to enter Twitter's board, Musk threw another "bombshell", saying that he planned to bid $41.4 billion for a wholly-owned acquisition to take Twitter private. In addition, Musk also said that he plans to change Twitter's running code and posting rules, with the goal of "establishing a new platform."

As soon as the figure was poor, Musk's "ambition" began to gradually appear. Isn't it a bit inflated? Musk, who is big in the box, clearly doesn't care about these things. What about being a barbarian? Instead, Twitter was alert to the crisis and began to launch the "poison pill" program, just in case. However, if Musk is "determined" to buy Twitter, what should he do?

On April 14, Twitter traded 257 million shares, which means that more than 30% of the shares changed hands on this day. Who's selling and who's buying? Some people say that Twitter is going to become a meme stock. You know, in a "retail vs. Wall Street" trading charge at the beginning of last year, the rise and fall of many stocks "all depends on the words of the forum", which is called meme stocks.

Today, Twitter's stock price rises and falls "entirely by Musk's words on Twitter." When Musk's offer to buy Twitter was posted on the SEC's website, Musk sent out the first tweet of the day: "I gave a bid." The attitude is already very obvious, Musk will first take the Twitter army. I've already given the price, so you can do it.

Musk said he was willing to buy Twitter in cash for $54.20 a share. Twitter's current total share capital is 764 million shares, which is estimated by Musk to value Twitter at $41.4 billion. Musk also wrote to Twitter's chairman of the board saying that Twitter's current model cannot advance its social significance and therefore needs to be privatized. He also said that if Twitter does not accept the all-purchase option, he may consider selling the stock. If Musk sells the stock, then Twitter's stock price will inevitably usher in another major turmoil, and a continuous decline is inevitable.

Wall Street stunned?

It is reported that Wall Street was surprised by Musk's statement, because it had the meaning of "bad people". That is, Twitter's shareholders will either accept the offer according to Musk's bid or wait for Musk to sell the stock in a big way and cause the stock price to collapse. This is a naked threat, and according to Musk's personality, it is obviously understandable to do so. Musk is not a common sense player, playing in a radical way, in line with his usual practice.

As soon as Musk's remarks were announced, Twitter's stock price directly reversed, turning from rising to falling, and it was sold all the way, selling lower and lower. That is to say, the capital market does not think that Twitter can accept Musk's tender offer, so there is a high probability that the two parties will eventually break up. Investors are undoubtedly a smart choice to leave the bag first, and in the case of great market uncertainty, it is obviously the choice of most investors to leave the market first. Of course, there is a sale and a buy, I don't know which party is licking the blood in the knife edge to take the chestnut, it is estimated that the bet is another future?

Interestingly, after Musk announced the price of the tender offer, he also interacted with netizens on Twitter and talked about the plan of the acquisition. Some netizens sent him Twitter's shareholder statements. Saudi Prince Alwaleed bin Talal has publicly expressed his opposition to Musk's acquisition. Musk replied: "I have two questions, the first is how much Twitter he holds directly or indirectly now? The second is what is the company's view of freedom of speech in the press? ”

Some netizens are worried about the corporate governance problems after he privatizes Twitter. Musk replied that he would retain as many shareholders as possible for as long as the law allows. Some netizens also believe that Twitter's board of directors will obstruct Musk's acquisition, and Musk replied that he hopes the board will make decisions according to the wishes of shareholders rather than their own. When news reports broke that Twitter had hired goldman sachs and other investment banks as trading advisers, Musk forwarded the report of the goldman Sachs securities investment department of netizens, which showed that goldman Sachs' investment department downgraded Twitter's investment rating to "outperform the market" because it was not optimistic about the current operation of Twitter. In short, this time, Musk is prepared and tit-for-tat.

Who's standing for Musk?

The shot on Twitter is obviously not a brain fever, and Musk should be well thought out. In the battle between Musk and Twitter, there will be a position. Outside of Goldman Sachs, Twitter has now hired a second investment bank, JPMorgan Chase, to help it deal with Musk's hostile takeover.

Standing next to Musk is Morgan Stanley. JPMorgan chase and Musk have had a history of unpleasant entanglements in the past. JPMorgan Chase & Co. still has lawsuits with Tesla, some of which are related to Musk's tweet in 2018 that he wanted to take Tesla private. However, goldman Sachs and Musk's relationship has been good. And Goldman Sachs is a consultant hired by Twitter, so will Goldman Sachs eventually become a lubricant between the two sides, or a bridge to pass on each other's "goodwill"?

It is reported that Damo has sent a team of top technology bankers led by Michael Grimes to assist the billionaire. In 2018, Musk hired Morgan Stanley to advise on plans to take Tesla private. Thus, in privatization, it is not without experience.

It can be seen that Musk is not alone, and Musk is still looking for multiple potential investors in order to group up to acquire Twitter. Tit-for-tat, Twitter on Friday unveiled details of plans to block Musk's acquisition. This will allow the company's original shareholders to obtain a large number of shares in the company at a lower price, thereby driving up the cost of the acquirer.

It can be said that the two sides have already begun to fight on the open side with real swords and guns. Musk's cleverness is to constantly make remarks on Twitter, and some of Musk's statements also point to Twitter's own problems. Musk, for example, said the economic interests of Twitter's board of directors are at odds with those of shareholders. He said that with the departure of Jack Dorsey, the board had "almost no stake collectively."

Musk is known to have been launching a social media campaign to influence public opinion in favor of his bid. Musk has tweeted several times about Twitter's operation. For example, he asked users "if they want an edit button" and suggested that Twitter should allow paid service users to pay with virtual currency, and that accounts should also receive a corresponding "authentication logo" while being free from all advertising. For some so-called zombie "big V", Musk is also outspoken criticism.

The two sides have been sword-fighting, and each other's moves will also affect the trend of Twitter's stocks in the coming period, and the back-and-forth turmoil is undoubtedly the main theme. And whether it will eventually be successful in privatizing Twitter depends on Musk's energy.