Elon Musk offers to buy Twitter
Last Updated on: 23rd April 2022, 12:39 am
One of the biggest stories of the week was that Elon Musk bought a 9.1% stake in Twitter, becoming one of the largest single investors in the social media platform.
Elon Musk is best known as being the current richest person in the world, with much of his fortune coming from being the co-founder and CEO of Tesla, the electric car manufacturer.
As it stands right now, Elon Musk’s net worth sits at approximately $272 billion, far surpassing Jeff Bezos who has a net worth of $188 billion, although to be fair I wouldn’t really complain about being the second richest person either.
Today, on April 14, Elon Musk officially announced that he has offered to purchase 100% ownership of Twitter.
In an official document from the United States Securities and Exchange Commission, details of Musk’s offer are made public including the staggering amount of money that is on the table to purchase Twitter.
” I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced. My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder.”
This figure comes out at approximately $41 billion, that is $41,000,000,000, that is a lot of zeros.
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Musk also notes that he will not budge on his offer and that declining the offer will lower his confidence in management and that he will need to reconsider his position as a shareholder, which could have dire consequences for the social media platform.
If Musk was to sell his stake, that would severely lower the price of shares, plummeting the market cap of Twitter.
a. I am not playing the back-and-forth game.
b. I have moved straight to the end.
c. It’s a high price and your shareholders will love it.
d. If the deal doesn’t work, given that I don’t have confidence in management nor do I believe I can drive the necessary change in the public market, I would need to reconsider my position as a shareholder.
i. This is not a threat, it’s simply not a good investment without the changes that need to be made.
ii. And those changes won’t happen without taking the company private.
It will be interesting to see what comes from this proposition as it is extremely unlikely that the shareholders will sell the company to Elon Musk, but he has put them over a barrel and is almost brute-forcing his way into owning Twitter.
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Grab your popcorn folks, things could get very interesting.
