Twitter Stuck Talking To Elon Musk About Possible Sale

Twitter Stuck Talking To Elon Musk About Possible Sale

Twitter Stuck Talking To Elon Musk About Possible Sale

Did Elon Musk finally make Twitter an offer that they can’t refuse?

Well, maybe yes, and maybe no. As we all know, Elon Musk put $43 billion on the table, after declining to join Twitter’s board of directors, in order to buy the company. Twitter instead opted for the “poison pill” strategy to protect themselves. And when I say “themselves” I mean the board of directors. However, Musk laid out his financing plan in filings to the SEC last Thursday, and the price being offered per share made shareholders pay attention.

Musk said Thursday in documents filed with U.S. securities regulators that the money would come from Morgan Stanley and other banks, some of it secured by his huge stake in the electric carmaker.”

The company said in a statement Thursday that it received Musk’s updated proposal and “new information on potential financing” and said its board is “committed to conducting a careful, comprehensive and deliberate review.”

Musk, who owns about 9% of Twitter shares, indicated that he’s exploring what’s known as a tender offer in which he would try to get other shareholders to pledge their stock to him at a certain price on a certain date, bypassing the board. If enough shareholders agree, Musk could use that as leverage to get the board to drop its “poison pill” defense against his offer of $54.20 per share.”

Well, apparently the shareholders had a few things to say to the board of directors, and they met with Musk on Sunday. Is $54.20 per share (which would make the final offer for the company $46.5 billion) the offer they can’t refuse?

Twitter Inc (TWTR.N) kicked off deal negotiations with Elon Musk on Sunday after he wooed many of the social media company’s shareholders with financing details on his $43 billion acquisition offer, people familiar with the matter said.”

The company’s decision to engage with Musk, taken earlier on Sunday, does not mean that it will accept his $54.20 per share bid, the sources said. It signifies, however, that Twitter is now exploring whether a sale of the company to Musk is possible on attractive terms, the sources added.”

While Twitter users can complain all they want, the board of directors knows perfectly well that if they DON’T at least appear to take Elon Musk seriously, there could be a shareholder revolt.

A concern that Twitter’s board weighed was that unless it sought to negotiate a deal with Musk, many shareholders could back him in a tender offer, the sources said.”

While the poison pill would prevent Twitter shareholders from tendering their shares, the company is worried that its negotiating hand would weaken considerably if it was shown to be going against the will of many of its investors, the sources added.”

And Twitter just can’t walk away from that much confirmed money without answering to the shareholders.

Twitter’s board should engage with Mr. Musk since its stock has “gone nowhere” since the company went public eight years ago, said Jeff Gramm, a portfolio manager with Bandera Partners LLC, a New York hedge fund with about $385 million under management. The firm last bought Twitter shares in February and owns about 950,000 overall, which accounts for about 11% of its portfolio.”

Mr. Gramm said Twitter’s board can’t walk away from Mr. Musk’s offer without providing an alternative that gives real value to shareholders. “I’m not sure what that can be at this stage besides finding a higher bid,” he said.”

The board is officially between a rock and a hard place. Musk has proved that he has the financial backing to buy Twitter. As much as the left will howl about their speshul sandbox needing MOAR REGULATION and “OMG what will happen if a rich man owns a media outlet???”, not one of them are stepping up to front $46.5 billion to buy the sandbox. But don’t worry, those most righteous among us are already virtue signaling about what they will do if Elon Musk succeeds in buying Twitter.

Yeah, these are also the same people that have threatened to move to Canada anytime an election doesn’t go their way, and yet they’re still here. I actually do believe that it would greatly benefit society if more people stopped living online lives as keyboard warriors, and had to actually interact with people again. But how many people will honestly delete their own Twitter accounts if Elon Musk owns the company?

If Elon Musk manages to buy Twitter, and holds to his promises of free speech, then it will be a win for all of us. What we need is MORE speech, not less. Regardless, I hope everyone is stocked up on popcorn, because this week could get really interesting (despite what some are claiming, there is no publicly confirmed timeline to the offer) and the takes from the speshul blue-checked people and their protestations about “muh DEMOCRACY” is going to be highly entertaining.

Is this actually about to happen. As in, right now?

Something is definitely going to happen, and soon…

Prepare yourselves, everyone!

It’s happened.

Brace yourselves for the hot takes and bitter tears of the left.

Featured image: Twitter logo by Mizter_X94 via Pixabay, cropped and modified, Pixabay license

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1 Comment
  • Tully says:

    When you’re 80% owned by mutual funds and venture funds and 10% owned by the guy who makes the offer and effectively 0% owned by the board, and that 80% says “Um, we want the money,” well, the board will cave.

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