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Elon Musk is the new absolute monarch of Twitter

posted onApril 26, 2022

Twitter management announced on Monday (April 25) that Tesla and SpaceX founder Elon Musk has agreed to acquire the social media company for $44 billion or $54.20 per share in cash.

"The Twitter Board conducted a thoughtful and comprehensive process to assess Elon's proposal with a deliberate focus on value, certainty, and financing. The proposed transaction will deliver a substantial cash premium, and we believe it is the best path forward for Twitter's stockholders," Twitter's Independent Board Chair Bret Taylor stated.

Twitter's board of directors initially refused to sell to the 50-year-old entrepreneur but after estimating its value and conducting talks with the billionaire it changed its mind.

Following the completion of the transaction, which is expected this year, Twitter's shares will be delisted and it will be taken private. The deal is subject to regulatory and shareholder approval.

Musk, a prolific Twitter user but also one of its loudest critics, had said it needs to become a private-held company to grow and become a genuine platform for free speech.

"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," the world's richest person according to Forbes, said in a statement announcing the deal.

"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," Musk added.

Reacting to news of the takeover agreement, Twitter co-founder Jack Dorsey posted a Spotify link to the Radiohead song “Everything In Its Right Place,” and said Musk is the “singular solution I trust” to run the company he co-created in 2006. “I trust his mission to extend the light of consciousness,” he said.

The takeover agreement comes as Twitter faces growing pressure from politicians and regulators over the content that appears on its platform.

Last year Twitter banned former US President Donald Trump, perhaps its most powerful user, citing the risk of "incitement of violence". Trump stated on Monday that he would not return to Twitter even if his account is reinstated.

“Did the Chinese government just gain a bit of leverage over the town square?” Amazon’s billionaire co-founder Jeff Bezos wrote on Twitter, hinting at Musk’s business ties to China. Musk established a Tesla factory in Shanghai in 2018 and the company relies heavily on Chinese firms to supply the materials that go into its batteries.

“My own answer to this question is probably not,” Bezos added. “The more likely outcome in this regard is complexity in China for Tesla, rather than censorship at Twitter.” “But we’ll see. Musk is extremely good at navigating this kind of complexity,” he added.

China has no intention to influence Twitter, Inc.'s policies regardless of the ownership, Beijing's Foreign Ministry spokesperson Wang Wenbin said on Tuesday.

Meanwhile, Russia's Security Council Deputy Chairman Dmitry Medvedev said that "no miraculous transformation will happen to Twitter" because the social network is not "capable of ignoring" the country it is registered in. It "won't become democratic again, much less fair" under Musk's ownership he said.

Despite its influence, Twitter has rarely turned a profit and hasn't really enjoyed the exponential growth of its rivals. The company, founded in 2004, ended 2021 with $5bn in revenue and 217 million daily users globally.

Twitter is slated to report first-quarter earnings Thursday.

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