The power game between Twitter and Musk finally came to an end, and on April 25, the board of directors of the well-known design platform Twitter officially announced that it had reached a final agreement with Musk, and Musk would fully acquire Twitter at a price of $54.2 per share, a transaction worth about $44 billion. After the transaction is completed, Twitter will be privatized.
As a legend, Musk's plan to acquire Twitter has attracted countless people's attention after it was exposed, what happened to Twitter's board from the initial activation of the "poison pill plan" to the final acceptance of the acquisition agreement?
Musk's planning
In early April, documents released by the SEC showed that Musk had long secretly bought shares in Twitter and had held 9.2% of its shares at the time of the announcement, becoming the largest external shareholder outside the board of directors, about 4 times the 2.25% of its founder.
After the news broke, Twitter shares rose 27 percent, their biggest gain in nearly four years. A week earlier, Musk had pretended to be confused, and at the end of March, he launched a vote on Twitter called "Do you think Twitter abides by freedom of speech", which received more than 2 million opinions, with 70.4% of the votes voting for Twitter not abiding by that principle.
It then made a statement about whether the public should abandon Twitter and build a platform based on free speech. At this point, many people speculated that it might start from scratch to create a new design platform.
However, the scheming Musk has already secretly laid out Twitter's stock early on, and finally his stake in Twitter was exposed by the US Securities and Exchange Commission in April. According to Bloomberg and other media exposure, it applied to the US Securities Exchange as early as March 14 to increase its holdings in Twitter.
Finally, on April 14, with its usual high-profile announcement, it would buy 100% of Twitter in full at $54.2 per share. Later, Twitter's board of directors announced that it would use the "poison pill plan" to counter Musk's acquisition in order to prevent "hostile takeovers". The poison pill plan is to dilute the acquirer's shareholding ratio by issuing a large number of new shares at a low price, so that the acquisition cost of the acquirer will increase greatly, and finally abandon the acquisition method.
However, after Musk publicized that he had received $46.5 billion in cash for the acquisition, the attitude of Twitter's board also changed dramatically. Soon after the two sides reached a consensus, Twitter's board decided to agree to Musk's acquisition plan, and Musk also celebrated his success by tweeting, calling it a return of free speech.
Publicly Available Information
Musk initially said it would be acquired at $54.20 per share and would make a wholly-owned acquisition in cash. While it was initially shown in its filing that the transaction was $43 billion at that price, it was recalculated to $44 billion. Although Musk is rich and worth hundreds of billions of dollars, most of his assets are still from the stock and equity of Tesla and other companies, and it is not easy to come up with $44 billion in cash at once. To raise cash for the acquisition, he revealed that he had raised $25.5 billion in loans from more than a dozen banks, plus the sale of some of Tesla's stock and his own cash, and he had raised enough cash to buy Twitter. After the acquisition is completed, Twitter will be 100% owned by Musk.
Information outside the public
Although Musk nominally invested $44 billion in the acquisition through his personal name, he also affirmed that he would provide about $21 billion in equity commitments, a transaction of this level, it is likely that more than four or five companies will participate, and some of the current major shareholders may also continue to hold shares in Twitter through Musk later.
The above suggests that Musk may not have to pay all of his $44 billion to take on the acquisition plan, which has greatly relieved Tesla stock holders, who have been afraid that Musk will sell too much Tesla stock to raise funds for the acquisition of Twitter, which will lead to the potential decline of Tesla stock.
Musk, as the largest family on earth, naturally cannot run Twitter wholeheartedly, after all, the man who aspires to send humans to Mars pays more attention to space and rockets. The current CEO of Twitter has only been in office for five months, and Musk has expressed his dissatisfaction with it without mercy. If the acquisition is completed, it is more likely to elect its friend, Twitter's founder Jack Dorsey, to take the position of CEO.
He expressed support for Dorsey in 2020, but he eventually left under the offensive of a hedge fund, and perhaps the acquisition also had a factor of revenge for his friends.
Musk said that when he takes power, he will defend the right of users to speak, and he has tweeted that even his opponents want to retain his right to speak.