In April, Elon Musk announced that he was buying Twitter for $54.20 per share, a cash transaction that was going to end up costing him roughly $44 billion in total. Before long, however, buyer’s remorse set in. He tried to get out of the deal, Twitter tried to keep him in, and after months of legal wrangling (and, presumably, millions more spent on lawyers), Musk is once again planning to buy Twitter for—wait for it—$54.20 per share.
Twitter confirmed the resurrected deal, saying that it “received the letter from the Musk parties which they have filed with the SEC” and that it plans to “close the transaction at $54.20 per share.”
Twitter issued this statement about today’s news: We received the letter from the Musk parties which they have filed with the SEC. The intention of the Company is to close the transaction at $54.20 per share.October 4, 2022
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The filing, available here, states that Musk “intends 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 and pending receipt of the proceeds of the debt financing contemplated thereby.” The only condition is that the courts immediately stay and adjourn the lawsuit between Musk and Twitter.
Musk’s legal representatives sent a similar letter to Twitter on October 3, noting the same conditions and stating that the offer comes “without admission of liability and without waiver or prejudice to any of their rights” if the lawsuit with Twitter isn’t stayed or Twitter, for whatever reason, refuses to agree to the resumption of the deal.
Musk hasn’t tweeted about his reasons for reversing his reversal, but a Bloomberg report states that his lawsuit against Twitter has not been going well, and that it appeared likely he would be compelled to finish the deal he agreed to earlier this year. Others noted that the discovery phase was not painting an overly flattering portrait of Musk either, and that the embarrassment had the potential to grow even worse if the case dragged on. Recently, private texts between Musk and public figures such as Joe Rogan were made public as part of the process. The trial was set to begin on October 17.
Elon Musk got embarrassed on Twitter yesterday by a lot of the Western world, and continuing this lawsuit would’ve meant releasing more private texts.There’s always a desire to over-intellectualize the decision-making of the richest guy in the world, but don’t over think this.October 4, 2022
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Regardless of his reasons, it now seems all but certain that Twitter will end up in Musk’s hands at some point in the relatively near future. What happens after that is anyone’s guess, but Twitter’s share price spiked immediately following the news, from $42.95 at 12 pm ET to $52 at 4:05 pm. Twitter’s share price had previously dropped as low as $32, well below Musk’s agreed purchase price.