Twitter Agrees To Acquisition By Elon Musk In A $44 Billion Cash Deal
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BRIAN DEAGON03:36 PM ET 04/25/2022
Twitter (TWTR) entered into a definitive agreement Monday to be acquired by Elon Musk for $54.20 a share in a cash transaction valued at $44 billion. Twitter stock jumped, as the company will be taken private upon completion.
In announcing the deal, Twitter Chief Executive Parag Agrawal said in a written statement: "Twitter has a purpose and relevance that impacts the entire world. Deeply proud of our teams and inspired by the work that has never been more important."
Twitter stock surged 6.4% to 52, during afternoon action on the stock market today. The deal is a 38% premium to Twitter's closing stock price on April 1 which was the last day before Musk disclosed his 9.1% stake in Twitter stock.
"Musk has secured $25.5 billion of fully committed debt and margin loan financing and is providing an approximately $21.0 billion equity commitment," the press release said. "There are no financing conditions to the closing of the transaction."
The company initially indicated it would rebuff Musk's offer. On April 14, Twitter implemented a "poison pill" intended to make the deal more costly. Twitter apparently reversed course after Musk said he had lined up financing for the deal, calling it his final offer.
"It all came down to no other bidders or white knights emerging in the M&A process and Twitter's board back was against the wall once Musk detailed his $46 billion in financing last week to get pen to paper on this deal," Wedbush analyst Dan Ives wrote in a note to clients.
Musk Began Buying Twitter Stock Early This Year
Twitter reports quarterly results before the market open on Thursday.
Musk began amassing shares in the company earlier this year. He owned 9.1% of Twitter stock as of his last filing with the Securities and Exchange Commission on April 20.
"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 in written remarks.
"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," he went on to say. "Twitter has tremendous potential – I look forward to working with the company and the community of users to unlock it."
Musk has more than 83 million followers on Twitter.
More to follow.
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