The battle between Elon Musk and Twitter (TWTR) appears to be over.
The billionaire CEO of Tesla (TSLA) has finally decided to resubmit his offer to acquire the microblogging website for $44 billion as he initially proposed, according to a regulatory filing, confirming information reported earlier by TheStreet.
"We write to notify you that the Musk parties intend to proceed to closing of the transaction contemplated by the April 25, 2022 merger agreement, on the terms and subject to the conditions set forth therein," wrote the billionaire's lawyer, Mike Ringler, of Skadden, Arps, Slate, Meagher & Flom.
There is one condition, however: Twitter's suit in the Delaware Chancery Court must be dropped.
The Delaware Chancery Court must "enter an immediate stay of the action, Twitter vs. Musk, et al. (C.A. No. 202-0613-KSJM) (the “Action”) and adjourn the trial and all other proceedings related thereto pending such closing or further order of the Court," Ringer said.
"The Musk parties provide this notice without admission of liability and without waiver of or prejudice to any of their rights, including their right to assert the defenses and counterclaims pending in the action, including in the event the action is not stayed, Twitter fails or refuses to comply with its obligations under the April 25, 2022 merger agreement or if the transaction contemplated thereby otherwise fails to close."
Musk will acquire Twitter for $54.20 a share, which was the original price, a source familiar with the matter told TheStreet.
Musk had made an offer on April 25 but withdrew it on July 8, explaining that Twitter had lied to him about the number of spam bots, or fake accounts, on the platform.
Twitter had filed a complaint, asking the Delaware Chancery Court to compel Musk to make good on his commitment.
A five-day trial was supposed to start October 17.
Twitter shares that had been suspended reopened more than 22% higher at $51.95, approaching but still below the price Musk has offered.
Billionaire Surprises Twitter
"We received the letter from the Musk parties which they have filed with the SEC," Twitter reacted. "The intention of the company is to close the transaction at $54.20 per share."
The company did not provide further details. Will Twitter agree to withdraw its complaint?
The two parties truly distrust each other after multiple rhetorical blows from Musk. The Musk-Twitter saga has taken a lot of twists and turns and even with Musk's disclosure, it's not certain that it's over. You can read all about the Musk-Twitter saga here.
Twitter and Musk had initially given themselves until Oct. 24 to complete the transaction.
After having acquired a 9.2% stake in the platform at the beginning of April, the billionaire had entered an agreement with management according to which he would take a seat on the board. In exchange he committed not to acquire more than 14.9% of the capital during a given period.
But Musk tore up this agreement a few days later, saying on April 14 that he wanted to acquire the whole group. Twitter agreed on April 25.
"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 then in a statement.
"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."
"Twitter has tremendous potential – I look forward to working with the company and the community of users to unlock it," he added
But after public shouting matches, he withdrew his offer on July 8.
"Mr. Musk is terminating the merger agreement because Twitter is in material breach," the billionaire explained. It "appears to have made false and misleading representations upon which Mr. Musk relied when entering into the merger agreement, and is likely to suffer a company material adverse effect (as that term is defined in the merger agreement)," the billionaire said.
On July 12, Twitter decided to sue the billionaire to enforce the original merger agreement.
"Twitter has filed a lawsuit in the Delaware Court of Chancery to hold Elon Musk accountable to his contractual obligations," Chairman Bret Taylor said on Twitter.
What Made Musk Change His Mind?
Musk had promised to take Twitter private to relaunch the platform. He had also promised that if he took control of Twitter he would restore the account of former President Donald Trump, who had been banned from the platform since the events of Jan. 6, 2021, at the Capitol.
It's hard to know what made Musk change his mind about buying the platform. What seems clear is that a battle of subpoenas leading to the trial between the two sides seemed to turn to the advantage of Twitter, experts say.
Twitter has always said that Musk withdrew his offer for mainly financial reasons. Financial markets have been falling for several months on fears of recession.
Speculation swirled that Musk, the world's richest man, sought to renegotiate the price. But the letter sent to Twitter's board in the evening of Oct. 3 does not talk about lowering the price or not, according to the source, who required anonymity to speak freely.
Musk is not asking for any discount, even as shares of technology groups have recently been hammered. He is asking only that the platform withdraw its court complaint.
The billionaire is an iconoclastic figure in business circles. He never does things like everyone else. He likes to stand out and he has made Twitter his favorite communication channel.
He has nearly 108 million followers on the platform, which he considers the crossroads where trendsetters and opinion makers meet. For Musk Twitter is the town square of our time.
The biggest problem with the platform is that while it may be popular, it does not generate big profits like its rivals Facebook (META), Instagram and TikTok.
How to monetize Twitter will be one of Musk's knottiest efforts if and when he closes the deal.
