Twitter has officially confirmed that it has accepted Elon Musk’s $44 billion all-cash offer to take the company private.
Under the deal, Twitter stockholders will receive $54.20 cash for each common stock. Shareholders are expected to vote on accepting the deal in the coming days.
Future of CEO is uncertain
While the deal puts an end to weeks of speculation, current Chief Executive Parag Agrawal reportedly told employees that the future of the company is uncertain. “Once the deal closes, we don’t know which direction the platform will go,” reported Reuters.
Agrawal will keep his job for the time being. However, if he is fired within 12 months of the takeover, he will receive an estimated $42 million in salary and equity, according to research firm Equilar.
Dorsey puts his weight behind Musk’s ownership
Following the announcement, former Twitter chief Jack Dorsey voiced his opinion, telling his Twitter followers that while he doesn’t believe “anyone should own or run Twitter,” Musk is the “singular solution” he trusts.
Musk continues, meanwhile, to push “free speech” as the motive behind his purchase. “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,” he said.
He also said he wants to make Twitter “better than ever” by adding new features, making the algorithms open-sourced, eliminating spambots, and authenticating real humans. “Twitter has tremendous potential – I look forward to working with the company and the community of users to unlock it.”
How will Musk fund the purchase?
The agreed price is a 38% premium from Twitter’s closing price on 1 April. According to Bloomberg estimates, the Tesla chief has just about $3 billion in liquid assets out of his $257 billion wealth.
The company confirmed that this is a “leveraged buyout” in part, backed by $25.5 billion debt raised from banks last week. This means that Musk should easily cover his $21 billion equity commitment.
Many Twitter users are also asking whether this means accounts suspended by the company will be allowed back – including Donald Trump.
In a Twitter thread, Amnesty International said: “We are concerned with any steps that Twitter might take to erode enforcement of the policies and mechanisms designed to protect users. The last thing we need is a Twitter that willfully turns a blind eye to violent and abusive speech against users, particularly those most disproportionately impacted, including women, non-binary persons, and others.”
White House spokesperson Jen Psaki U.S. President Joe Biden “has long been concerned about the power of large social media platforms”, whoever owns or runs Twitter.
And Democrat Senator Elizabeth Warren said the deal was “dangerous for our democracy,” while pushing for a wealth tax and “strong rules to hold Big Tech accountable”.
Dogecoin, Musk’s meme coin of preference, shot up 30% in the 24 hours following the announcement.
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