Elon Musk is the richest man in the world; he has Tesla Inc (NASDAQ:TSLA), Neuralink, SpaceX, and now, potentially, Twitter Inc (NYSE:TWTR), too.
Musk made stock market headlines earlier this month when bought more than 9% of Twitter stock. Speculation was built as to his intent. Would he become an activist? Was this his move to help put him in the good graces of the platform, or was it something else? This week, Musk has done it again, and Twitter’s stock has reacted.
Filing Specifics: “On April 13, 2022, the Reporting Person delivered a letter to the Issuer (the ‘Letter’) which contained a non-binding proposal (the ‘Proposal’) to acquire all of the outstanding Common Stock of the Issuer not owned by the Reporting Person for all cash consideration valuing the Common Stock at $54.20 per share (the ‘Proposed Transaction’). This represents a 54% premium over the closing price of the Common Stock on January 28, 2022, the trading day before the Reporting Person began investing in the Issuer, and a 38% premium over the closing price of the Common Stock on April 1, 2022, the trading day before the Reporting Person’s investment in the Issuer was publicly announced.”
Musk's primary focus on free speech. Several Tweets from the Tesla CEO highlighted contention for media outlets either favoring left- or right-leaning messaging. He also discussed how “top” Twitter accounts were rarely used anymore.
Musk also tweeted out the question, “Is Twitter Dying?” Later in the session, Twitter would come out to say that they received the bid but the current bid values the company much lower than it was last summer when it reached $70.
In a TED talk Musk explained that he feels it’s “very important for there to be an inclusive arena for free speech,” and that he intends to allow as many shareholders as possible in a private company. Further, Musk is said to have heard from outside investors interested in offering equity for the $43 billion bid according to sources in The Wall Street Journal. The Tesla CEO also hinted at having an alternative plan if his bid is rejected by Twitter but has yet to elaborate on it.
Twitter is said to be mulling over a “poison pill” to block musk from taking over the company. Also referred to as a shareholder's rights plan, it generally means a more expensive scenario for any type of hostile takeover. Shareholders are offered the right to buy more shares at a discount, which in turn dilutes their existing interest in a “hostile” party.
