Will Elon Musk Really Buy Twitter?

April 25, 2022 Topic: Elon Musk Region: United States Blog Brand: The Buzz Tags: TwitterSocial MediaTeslaBillionairesCensorshipStocks

Will Elon Musk Really Buy Twitter?

Media reports state that Musk’s attempt to purchase Twitter may not be such a long shot after all.

In recent weeks, the world’s richest man, Elon Musk, has made noises about wanting to purchase Twitter. At first, the effort seemed like a long shot, especially when Musk proposed a self-funded bid of $43 billion to purchase the social media company, one that Twitter’s board soundly rejected, later instituting a “poison pill” to prevent such a takeover. Musk later announced that he had lined up financing for another offer, with Morgan Stanley leading the financing.

Now, media reports state that Musk’s attempt to purchase Twitter may not be such a long shot after all.

The Wall Street Journal reported Sunday that the Twitter board had taken steps towards “re-examining” Musk’s offer and that the sides were meeting on Sunday.

“Twitter is taking a fresh look at the offer and is more likely than before to seek to negotiate,” the Journal said, citing “people familiar with the matter.”

A separate report from the New York Times reported the same and added that while the initial offer led to skepticism that Musk had enough liquid cash available to pay for his bid, the lining up of financing has reduced some of that skepticism, inside and outside of Twitter.

Twitter’s board is “continuing to conduct a careful, comprehensive, and deliberate review to determine the course of action in the best interest of the company and all Twitter stockholders,” the company said last week in a statement, per the Times.

Daniel Ives of Wedbush Securities, an analyst who has long covered one of Musk’s other companies, Tesla, weighed in on the Journal report over the weekend.

“While the Board approved the poison pill which essentially gave them time to find a "white knight" and second bidder, likely they are now empty-handed from private equity circles staring at a hostile tender offer process likely kicked off this week by Musk for the bid,” Ives wrote in a note to clients Sunday.

“The Street will read this news today as the beginning of the end for Twitter as a public company with Musk likely now on a path to acquire the company unless a second bidder comes into the mix.”

While Musk’s bid is at a premium to where Tesla was trading as of Friday, it’s lower than the company’s stock price last week.

A Twitter power user who has more than 83 million followers on the social network, Musk has been critical in recent years of the company’s content moderation policies. Techdirt, on April 15, published a critique of Musk’s position on moderation and other issues likely to be points of contention, based on a Musk-delivered TED talk earlier this month.

Twitter will release its quarterly financial results on Thursday. 

Stephen Silver, a technology writer for The National Interest, is a journalist, essayist and film critic, who is also a contributor to The Philadelphia Inquirer, Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.

Image: Reuters.