Twitter is poised to agree a sale to Elon Musk for around $43 billion in cash, the price the chief executive of Tesla has called his “best and final” offer for the social media company, people familiar with the matter said.
According to the sources, Twitter may announce the $54.20-per-share deal later on Monday after its board meets to recommend the transaction to Twitter shareholders. It is always possible that the deal collapses at the last minute, the sources added.
According to Forbes, Musk, the world’s richest person, is negotiating to buy Twitter on his own, and Tesla is not participating in the deal.
Twitter has not been able to secure so far a ‘go-shop’ provision under its agreement with Musk that would allow it to solicit other bids once the deal is signed, the sources said. Still, Twitter would be allowed to accept an offer from another party by paying Musk a break-up fee, the sources added.
Because the topic is private, the sources requested anonymity. Requests for responses from Twitter and Musk were not immediately returned.
Twitter’s stock was up 4.5 percent in pre-market trade in New York on Monday, closing at $51.15.
Musk has stated that Twitter must be turned private in order to flourish and become a genuine forum for free speech.
The deal would take place just four days after Musk disclosed a financial plan to support the acquisition. This prompted Twitter’s board to examine the purchase more seriously, and many shareholders urged the firm not to let the possibility for a deal to slip away, Reuters reported on Sunday.
The sale would be an admission by Twitter that its new CEO, Parag Agrawal, who took over in November, is not making enough progress toward making the firm more profitable, despite the fact that the company is on schedule to reach ambitious financial targets established for 2023.
Even as late as November, Twitter’s stock was trading higher than Musk’s bid price.
Musk’s negotiating strategy, which involves making a single offer and sticking to it, is similar to how another billionaire, Warren Buffett, negotiates acquisitions.
Musk did not release any financial details when he first announced his bid for Twitter, which made the market suspicious of its prospects. – The Reuters