According to CCTV news, on April 25, local time, the social media platform Twitter accepted Elon Musk's acquisition agreement. Under the deal, Musk will buy Twitter for $54.20 per share, totaling about $44 billion.
The deal is expected to close in 2022, and twitter will become a privately held company after the deal closes, China Daily reported. Reuters reported that the world's richest people will control the social media platform with hundreds of millions of users, including global leaders.
As of the close of trading on April 25, local time, Twitter was quoted at $51.69 per share, up 5.64%, with a market value of $39.477 billion.
Musk Xinhua News Agency infographic
Musk's "Love-Hate Feud" with Twitter
On the 21st, Musk publicly said that he had prepared about $46.5 billion as a purchase of Twitter.
Earlier, Musk also announced its specific financing arrangements: Morgan Stanley and other institutions will provide $13 billion in loans, as well as $12.5 billion in Tesla equity collateral and $21 billion in cash. After the transaction was approved by the board of directors on the 25th, it also needs to obtain the consent of the regulatory unit and Twitter shareholders before Musk can complete the acquisition.
At that time, Twitter's shareholders will receive $54.20/ordinary share in cash. This represents a 38 percent premium to Twitter's stock price on the last trading day musk announced on April 1, nearly 30 percent below last year's high. Butel, chairman of Twitter's independent board, said twitter's board, after a deliberate and thorough review of Musk's proposal, believes that the acquisition proposal will bring a substantial cash premium and is the best option for shareholders.
Since Musk acquired 9% of Twitter's shares in early April, there have been news that Musk refused to join the board, and the Twitter board and some major shareholders opposed Musk's acquisition proposal and may adopt the "poison pill plan" to block Musk's acquisition.
However, less than two weeks after the deal was negotiated, the situation suddenly changed.
Twitter's board's change of attitude may be due to the decline in its stock price this year and the limited effectiveness of the new features introduced to increase revenue, so it is willing to accept Musk's offer price. Musk's proposed price of $54.20/share is consistent with the final transaction price.
Twitter founders have pushed Musk for six consecutive years
After Tesla CEO Elon Musk's acquisition of Twitter was finalized, Twitter founder Jack Dorsey sent 6 tweets in a row to express his expectations for Musk.
Dorsey is reportedly a co-founder and former CEO of Twitter, having led Twitter to go public in 2013. Beginning in 2020, Elliot Management, one of Twitter's aggressive hedge funds, drove a major change in Twitter, and under pressure, Dorsey abruptly resigned as CEO last November to be replaced by Parag Agrawal, who had been CTO.
After the news of the acquisition, Dorsey first tweeted a song called "Everything Is In Its Right Place."
He then commented, "I love Twitter. Twitter is the closest thing we have to global awareness. ”
Dorsey called Twitter his biggest regret, saying, "The idea and service are the most important to me, and I will protect both at all costs." Twitter has always been my only problem and my biggest regret. It's already owned by Wall Street and the advertising model. Taking it back from Wall Street is the right first step. ”
He added, "In principle, I don't think anyone should own or operate Twitter. It should be a public good at the protocol level, not a company.
Dorsey's praise for Musk is overflowing. He called Musk a "unique solution" to the Twitter problem and called Musk's mission "to expand the light of consciousness."
"Elon's goal is to create a platform that is 'trusted and inclusive to the maximum extent', and rightly so." Dorsey continued, "That's also Parag's goal (Twitter CEO Parag Agrawal) and why I chose him. Thank you for saving the company from an impossible situation. It's the right path... I totally believe that. ”
In conclusion, he said, "I am pleased that Twitter will continue to serve the public conversation." All over the world, even fly to the stars! ”
It is reported that Dorsey is a good friend of Musk, the two often interact on Twitter, and Dorsey has also tweeted many times to express dissatisfaction with Twitter's board.
Twitter has lost money for two consecutive years
Currently, Twitter is relatively small compared to global social media giants.
It is reported that Twitter was founded in 2006 and is now 16 years old. For an Internet company, 16 years is not young. Meta (Facebook), which was founded in the same period, has long since grown into a global Internet giant.
Investors have also been critical of Twitter for years for failing to reach its full potential. Twitter can't get billions of users like Facebook (Facebook's daily activity is more than 11 times twitter's) and it can't grow as big as YouTube (YouTube's revenue in the last quarter was more than five times twitter's).
From 2015 to 2018, Twitter's monthly active user data remained in its early 300 million, and the indicator has not been disclosed since then. Currently, its newly announced "Monetizable Daily Active Users (mDAU)" is 217 million, mainly to show customers the value of its ads.
According to Statista, as of January 2022, Facebook ranked first with 2.91 billion in the monthly active activity (MAU) ranking of all social media in the world, Followed by YouTube (2.562 billion), WhatApp (2 billion), Instagram (1.478 billion) and WeChat (1.263 billion). Twitter ranks 15th on the list, or just 436 million.
It should also be noted that Twitter has lost money for two consecutive years – losing 1.136 billion in 2020 and narrowing to 221 million in 2021.
In the past 7 years, Twitter has failed to achieve profitability for 5 years. Twitter's stock price has since hit an all-time high of $80.75 in intraday on February 25, 2021, but has rebounded nearly 40% after bottoming out in late February.
After being acquired by Musk, Twitter will also be "X" in the future?
Musk has clearly planned everything from investing in Twitter, to becoming a major shareholder, to launching an acquisition proposal. From the official announcement of the largest shareholder to the announcement of the acquisition, there are only 10 days. Twitter's board of directors also took only 11 days from boycotting the acquisition to finally nodding.
After Twitter announced his acceptance of the deal, Musk tweeted, "I hope that the harshest criticism of me can also stay on Twitter, because that's what free speech is about." ”
Musk also issued a statement saying that it also improved products with new features, opened up platform algorithms to enhance trust, cracked down on fake trolls, verified all human users, and helped the Twitter platform become better. Musk has planned a series of "reforms" after becoming Twitter's majority shareholder, such as proposing price cuts for Twitter's Blue subscription service, banning ads and allowing users to pay with Dogecoin, and transforming Twitter's headquarters into a homeless shelter.
In this regard, the Wall Street Journal said that Musk hopes to make substantive reforms to Twitter. The report lists some of Musk's views on improving Twitter's means of operations, for example, Twitter should be more cautious when deciding whether to take down tweets or permanently ban users, and temporary filtering may be a better option.
Musk also suggested adding a Tweet editing feature to fix errors in tweets that have already been tweeted. Earlier this month, he surveyed Twitter users about whether he wanted to add a tweet editing feature, with more than 4 million users voting, with more than 70 percent of respondents saying they wanted to add the feature.
In addition, Musk also suggested making Twitter's algorithm open source, which means that others outside of Twitter will be able to view the source code and can suggest fixes and changes.
Hitting the proliferation of "robots" on Twitter could be another change Musk likes. This "bot" refers to a fake account that is programmed to respond to tweets on a specific topic. According to NPR, although Musk did not explicitly say that he was willing to crack down on such "bots," he suggested that fraudulent "bots" that promote cryptocurrency transactions should be cracked down.
Musk also said last week, "If our Twitter bid is successful, we will beat the 'spam bots.'" He wants to "validate all real humans." ”
In addition to the "vision" of Twitter's operation, on the 18th local time, Musk turned his attention to all the members of Twitter's board of directors, and he shouted on Twitter, "If my bid is successful, (Twitter)'s board salary will be $0, so you can save about $3 million a year."
Twitter's current CEO, Parag Agravar, reportedly said at a staff meeting that Twitter would face uncertainty in the future after Elon Musk completed his privatization deal with Twitter.
The business empire of the richest man
In fact, in addition to the "acquisition of Twitter" move that has just been completed, the chess pieces placed by musk, the first richest man, also covers many fields such as automobiles, energy, space, and transportation.
tesla
Tesla, the American electric car company, is the company with the closest ties to Musk. Founded in 2003 by Martin Eberhard and Mark Tapening, the company manufactures and sells electric vehicles, solar panels, and energy storage equipment. In February 2004, Musk invested $6.3 million in Tesla, provided that he became chairman of the company and had the final say on all matters, and Martin Eberhard was the company's CEO as Tesla's father. In October 2008, Musk became CEO of Tesla.
On January 27, 2022, Tesla released its 2021 full-year financial report. Revenue for 2021 was $53,823 million, up 71% year-over-year, and net income attributable to shareholders was $5,519 million, up 665% year-over-year. At the same time, Tesla's global deliveries in 2021 also reached 936,200 units, an increase of 87% year-on-year. Among them, the delivery volume in the Chinese market was 484,100 units, an increase of 235% year-on-year. In the first quarter of this year, Tesla's profit soared by nearly 700% to $3.318 billion. Total revenue for the first quarter was $18,756 million, up 81% from $10,389 million in the year-ago quarter. There is no doubt that Tesla is the world's number one manufacturer of pure electric vehicles.
SpaceX
SpaceX, a space exploration technology company founded by Musk in June 2002 with a $100 million investment, became CEO and chief technology officer. Musk's "Martian" title is related to SpaceX. Musk has been very interested in colonizing Mars for many years, and he once publicly stated in an interview with the media that he wanted to build a human community on Mars, and thought that it would be possible in about 2024. Although the "Mars Colonization Program" is not very reliable, SpaceX successfully completed the manned flight. In addition, since the first launch of the Mega Constellation Project in 2019, SpaceX has launched more than 2,300 Starchain satellites into low-Earth orbit.
Boring company
The Boring Company, founded in December 2016, is a rail transit company that tackles ground congestion. According to Musk's vision, he will install a "pallet" on the ground where the car is suspended, and after the car is parked, the pallet will descend to the ground, and the car will be transported quickly between the underground tunnels, and the fastest speed will even reach 200 kilometers per hour. On April 20, The Boring Company announced that it had raised $675 million in a Series C funding round, which has prompted the company, which is committed to creating an underground tunnel network and 3D transportation, to a current valuation of $5.675 billion.
Neuralink
Neuralink is a company founded by Musk that studies brain-computer interface technology. The brain-computer interface is to implant a very small electrical level into the brain, using the current to make the computer and brain cells "interact". Recently, Musk revealed that Neuralink will focus on solving brain and spine injuries in the next decade, and said that the company is expected to conduct its first human trials by the end of this year.
PayPal
Musk also had a "fate" with payment giant PayPal. PayPal's predecessor was in 2000, when Confinity merged with musk-founded X.com to rename the X.com PayPal. At the time, Musk was CEO, but was impeached by employees and the board of directors for mismanagement. In 2002, e-commerce giant eBay bid to acquire PayPal. Musk is the largest shareholder in PayPal, owning an 11.7 percent stake. Later, PayPal quickly developed into a global mobile payment giant and spun off from eBay.
X Holdings
Shortly before that, Musk created three holding companies called "X Holdings," which made it possible for him to attribute all of his business to one parent company. After the acquisition of Energy Twitter, Musk's business empire has also shifted from physical manufacturing to the Internet and media, and has the initiative on social media.
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