California, Europe Brief News – According to sources familiar with the situation, Twitter Inc (TWTR.N) was on the verge of agreeing to a deal with Elon Musk for $43 billion in cash, which the Tesla CEO has dubbed his “best and last” bid for the social media business. But now deal is closed for $44 Billion
After its board meets to endorse the acquisition to Twitter shareholders, Twitter may announce the $54.20-per-share agreement later on Monday, according to the sources. In addition, the sources said that the agreement might fall apart at the last minute. Let’s talk about what went down in the deal between Twitter and Elon Musk!
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Twitter and Elon Musk Sign the Deal
As reported by Forbes, Tesla CEO Elon Musk is in talks to acquire Twitter on his own behalf, and the company is not participating in the negotiations.
According to the sources, Twitter has been unable to get a “go-shop” option in its agreement with Musk that would enable it to seek alternative offers after the contract is inked. A break-up fee might still be paid by Twitter in order to accept an offer from another party, according to the sources.
Because this is a private situation, the informants wanted anonymity. Requests for a response from the media were not immediately returned by either Twitter or Musk.
In pre-market trading in New York on Monday, Twitter shares rose 4.5 percent to $51.15.
Musk’s Offer
Elon Musk has said that Twitter has to be turned private in order to develop and become a really libertarian forum.
After Musk announced a finance package to support the purchase only four days earlier, the transaction would be finalized just four days later. Many Twitter shareholders then urged the company’s board of directors not to let the merger chance pass them by.
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In case of Selling Twitter!
In selling the company, Twitter would be admitting that its new chief executive, Parag Agrawal, who took over the reins in November, is not gaining enough traction in turning the company profitable, despite the fact that the company is on track to meet the ambitious financial goals it set for itself in 2018. Tweeter’s stock was trading at a premium to Musk’s offer price as late as November, according to Bloomberg.
Musk’s bargaining strategy – making a single offer and sticking to it – is similar to that of another billionaire, Warren Buffett, when it comes to purchasing negotiations. As a result of Musk’s failure to provide financial facts when he originally announced his bid for Twitter, the market was suspicious about the company’s future prospects.
Hence the negotiation between Twitter and Elon Musk came into media’s eyes.
