Elon Musk, the co-founder of Tesla Inc. and SpaceX, has recently acquired Twitter, which has immediately garnered everyone’s attention. This transaction is worth $44 billion in total. One of the significant social media acquisitions following Facebook’s 2014 purchase of WhatsApp.
This week marked the beginning of a new chapter in the book titled “Tale of Twitter with Musk,” which also introduced Twitter’s new chief executive officer, Elon Musk. The acquisition of Twitter by Musk was the subject of months of negotiations and disputes. Last Thursday, Twitter’s CEO made a surprise visit to the company’s headquarters in San Francisco, carrying a sink and having Twitter allow him and that sink in as a visual pun on the term “let it sink in.” After a busy and adventurous couple of days, he successfully closed the deal.
Entering Twitter HQ – let that sink in! pic.twitter.com/D68z4K2wq7
— Elon Musk (@elonmusk) October 26, 2022
The complicated history between Musk and Twitter brings to mind Steve Jobs’ return to the business he co-founded, Apple, in the mid-1990s after being forced out in 1985 by computer manufacturers. Back then, Microsoft acquired Apple.
Everything you need to know about how Elon Musk acquired Twitter;
Elon took to Twitter in late March 2022 to conduct a vote on whether or not the Twitter algorithm should be made public. In a resounding majority of cases, yes. A few days later, when another survey was out, he tweeted, “Free speech is essential to a functioning democracy. Do you believe Twitter rigorously adheres to this principle?” The majority of people who voted were found in favour.
Free speech is essential to a functioning democracy.
Do you believe Twitter rigorously adheres to this principle?
— Elon Musk (@elonmusk) March 25, 2022
A document with the SEC made public on April 4, 2022, indicated that Musk owned 9.2 percent of Twitter, which began trading on the New York Stock Exchange in 2013. The announcement sent Twitter’s stock price soaring by as much as 16% in pre-market trading.
He was given the opportunity to join Twitter’s board of directors the next day, but on April 11 the company’s CEO at the time, Parag Agrawal, announced that Musk will not be joining the board and did not provide a specific explanation for this about-face. This was the first indication of a rollercoaster ride that was to follow.
Elon has decided not to join our board. I sent a brief note to the company, sharing with you all here. pic.twitter.com/lfrXACavvk
— Parag Agrawal (@paraga) April 11, 2022
In an interesting turn of events, Musk then suggested acquiring Twitter fully in 2022 on April 14 for the price of $44 billion and claimed he will strive to keep as many stockholders as are “allowed by law.”
I made an offer https://t.co/VvreuPMeLu
— Elon Musk (@elonmusk) April 14, 2022
Elon Musk disclosed the key goals he intends to accomplish after he takes command of Twitter, which are to combat spam bots and verify actual individuals.
And authenticate all real humans
— Elon Musk (@elonmusk) April 21, 2022
On April 25, Twitter announced that it accept Musk’s offer to take over the company and that it would become a privately owned corporation once the deal was finalised. One day later, in order to provide more backing for his viewpoint on free speech, the co-founder of Tesla posted this:
🚀💫♥️ Yesss!!! ♥️💫🚀 pic.twitter.com/0T9HzUHuh6
— Elon Musk (@elonmusk) April 25, 2022
A few weeks later, Elon Musk put the deal on indefinite hold a few weeks later, citing the fact that he would want complete facts on the prevalence of spam accounts and fraudulent accounts on the site. His justification was that he would need more information about these issues.
Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of usershttps://t.co/Y2t0QMuuyn
— Elon Musk (@elonmusk) May 13, 2022
He accused the then company’s chief executive officer Parag Agrawal “refused” to provide evidence that the percentage of spam accounts on the site is less than 5%.
Due to Twitter’s unwillingness to reveal critical information connected to spam accounts on the site in response to Musk’s repeated demands, the increasing animosity led to Musk terminating the agreement in place on July 8, however, this time around he did not send out a tweet before doing so.
Musk was subsequently sued by Twitter on July 12 for terminating the deal, and Twitter petitioned the Delaware Court of Chancery to complete the acquisition at the agreed conditions, expressing its commitment to ensuring the acquisition goes through and stating its intention to complete the merger.
The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.
— Bret Taylor (@btaylor) July 8, 2022
On August 23, Peiter ‘Mudge’ Zatko, former Twitter security head, turned whistleblower, stating that the site has really been misrepresenting the public on bots and security standards. This added further credence to the evidence that Musk was presenting in the lawsuit against Twitter.
Zatko would go on to testify on September 13 stating that Twitter prioritised “profits over security,” arguing that the company’s technology lagged behind industry norms by more than a decade.
Nonetheless, on October 4, just a few days before he was scheduled to be questioned under oath by Twitter’s legal team, Musk made the surprise remark that the agreement with Twitter seemed to be proceeding as planned. The court granted both sides until October 28, at 5 o’clock in the afternoon, to complete the deal.
Buying Twitter is an accelerant to creating X, the everything app
— Elon Musk (@elonmusk) October 4, 2022
Now that the acquisition has been completed, the existing owners of the firm will receive compensation of $54.2 per share. The firm will be delisted from the NYSE on November 8, 2022, and also trading was halted on October 28, 2022, just before the market started.
The report says Musk is utilising debt and equity finance to finalise the $44 billion transaction. Since April, he sold $15.5 billion worth of shares from Tesla, which gave him enough capital to pay over $27 billion from his assets. Morgan Stanley also contributed to this deal with a $13 billion loan. Finally, $5.2 billion was adjusted from various investment groups.
Musk will now run Twitter as a private firm after successfully completing the acquisition of one of the most popular social media networks in the world. He has installed himself as the company’s new Chief Executive Officer, and as his first move, he has fired several of Twitter’s top executives. These executives include CEO Parag Agrawal and legal Chief Vijaya Gadde, as well as chief financial officer Ned Segal, who joined Twitter in 2017, and Sean Edgett, who has served as general counsel at Twitter since 2012.
According to US SEC, Twitter’s filing shows that Musk would be liable to pay over $100 Million to fired leaders as a part of their exit deal. It also says Agrawal is entitled to receive approximately $67 million (roughly INR 552 crore).
So, this brings us to the end of our article. We hope it was insightful and informative. Let us know in the comment section what you think about Elon Musk’s catchy actions as the new CEO of Twitter and share your thoughts with us.