Billionaire businessman, Elon Musk is looking to expand his investment portfolio into social media companies as he has made an offer to purchase Twitter.
Musk took to Twitter to tweet, “I made an offer” with a link to a United States Securities and Exchange Commission filing.
I made an offer https://t.co/VvreuPMeLu
— Elon Musk (@elonmusk) April 14, 2022
According to a filing, the billionaire (referred to as the Reporting person) is stated inter alia;
“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.”
The offer made proposed to purchase the rest of Twitter shares for 38% more than it was worth at the end of the closing price of Twitter stock on April first bringing his proposed purchase price to $41.39 billion.
According to Sky News, the billionaire wrote a letter to the Chairman of the Twitter board, Bret Taylor on his intentions to purchase the company stating “I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy, Since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.”
“As a result, I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced,” he wrote. “My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder.”
The billionaire who recently purchased 9.2% of Twitter shares is currently the largest Twitter shareholder. He was supposed to be on Twitter board as was announced by the current CEO of Twitter. However, the billionaire, for reasons not expressly stated didn’t join the board.
Decision not to join the board linked to purchase offer
- Even though analysts have had several speculations on what his reason might be for not wanting to be on the board, his decision makes more sense now as a takeover of the company wouldn’t have been possible as a member of the board.
- Being a board member would put him in a box and he wouldn’t be able to purchase more Twitter stock and subsequently purchase the entire company.
- Musk currently owns 73,486,938 Twitter shares, which is currently worth £3.3 billion.
