Tesla, SpaceX and Starlink founder and CEO Elon Musk, the world’s richest man, has become the principal shareholder in one of the world’s biggest social media platforms after Twitter agreed to his offer.
“Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated,” Musk said after the deal was announced. “I also want to make Twitter better than ever by enhancing the product with new features, making the algorithms open source to increase trust, defeating the spam bots, and authenticating all humans. Twitter has tremendous potential – I look forward to working with the company and the community of users to unlock it.”
A PRN Newswire press release added: “Musk has secured $25.5 billion of fully committed debt and margin loan financing and is providing an approximately $21.0 billion equity commitment. There are no financing conditions to the closing of the transaction.”
Early Monday, reports noted that Twitter appeared set to accept Musk’s buyout offer of around $43 billion.
“Twitter may announce the $54.20-per-share deal later on Monday once its board has met to recommend the transaction to Twitter shareholders, the sources said, adding it was still possible the deal could collapse at the last minute,” Reuters reported.
“Twitter has not been able to secure so far a ‘go-shop’ provision under its agreement with Musk that would allow it to solicit other bids once the deal is signed, the sources said. Still, Twitter would be allowed to accept an offer from another party by paying Musk a break-up fee, the sources added,” said the report.
The offer to buy out the platform comes following Musk’s purchase of nearly 10 percent of the company’s stock earlier this month. At the time, the purchase made him the platform’s largest shareholder.
“Twitter shares surged about 26% in premarket trading after the regulator filing released Monday detailing Musk buying the holding,” Bloomberg reported at the time. “The stake is worth about $2.89 billion.
After suggesting that Twitter “fundamentally undermines democracy” by not defending free speech, Musk conducted an informal poll on the platform, ironically, to ask, “Free speech is essential to a functioning democracy. Do you believe Twitter rigorously adheres to this principle?” More than 2 million people responded to the poll with 70.4 percent saying that Twitter did not adhere to the principle.
“The consequences of this poll will be important,” Musk continued. “Please vote carefully.”
Musk followed up on the poll by noting: “Given that Twitter serves as the de facto public town square, failing to adhere to free speech principles fundamentally undermines democracy. What should be done?”
He then asked: “Is a new platform needed?”
“Would you consider building a new social media platform, [Elon Musk]?” one Twitter user asked. “One that would consist of an open-source algorithm, one where free speech and adhering to free speech is given top priority, one where propaganda is very minimal. I think that kind of a platform is needed.”
“Am giving serious thought to this,” Musk responded.
After making his initial offer, Musk appeared at a TED talk and was asked what would happen if the deal fell through.
“If in this case you are not successful in that the board does not accept your offer, you’ve said you won’t go higher, is there a plan B?” an audience member asked.
“There is,” Musk responded while smiling.
Musk was asked about his backup plan, but he declined to elaborate, saying he would discuss it later.
According to an updated filing with the Securities and Exchange Commission last week, Musk was continuing to explore a tender offer to acquire the company’s outstanding stock shares at $54.20 per share in cash. In addition, he also claimed to have secured $46.5 billion in financing for the massive deal.
“Musk’s original $43 billion offer to the board was a 38% premium over the closing price on the day before news broke that Musk had bought up 9.6% of the company and an 18% increase from the closing price before the purchase was announced,” the Washington Examiner reported at the time.
After he made his initial offer, Musk took to the platform again to list two major changes he would make if the purchase went through.
“If our twitter bid succeeds, we will defeat the spam bots or die trying!” he wrote. “And authenticate all real humans.”
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