Elon Musk closes deal to buy Twitter for $44b in cash

Elon Musk waded through legal and "poison pill" threats and employee angst before the Twitter Board of Directors on Monday approved his offer to buy the iconic social media platform.

The world's richest person and CEO of electric-vehicle company Tesla clinched a deal to acquire the company for $44 billion in cash. He said he will take the company private; its shares currently trade on the New York Stock Exchange.

The transaction was unanimously approved by Twitter's board and is subject to a shareholder vote. Discussions about the deal, which last week appeared uncertain, accelerated over the weekend after Musk wooed Twitter shareholders with details of his offer.

Under pressure, Twitter started negotiating with Musk, 50, to buy the company at his $54.20-a-share offer, which was made on April 13.

The deal represents a 37 percent premium to Twitter's closing share price on Friday, April 1. On Monday, April 4, when the stock market reopened, Musk disclosed that he had bought more than a 9 percent stake.

Twitter shares have traded as high as $77 in the past year; they closed Monday at $51.70, up $2.77 or 5.7 percent.

"Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated," the South Africa-born Musk, who has 83.6 million Twitter followers, said in a joint statement with Twitter.

"I also want to make Twitter better than ever by enhancing the product with new features, making the algorithms open source to increase trust, defeating the spam bots, and authenticating all humans," he said. Musk also previously had polled Twitter users about adding an edit button for their tweets.

Later Monday on Twitter, Musk, who has described himself as a "free speech absolutist" wrote, "I hope that even my worst critics remain on Twitter, because that is what free speech means."

Bret Taylor, Twitter's independent board chair, said in the joint statement: "The Twitter Board conducted a thoughtful and comprehensive process to assess Elon's proposal with a deliberate focus on value, certainty, and financing. The proposed transaction will deliver a substantial cash premium, and we believe it is the best path forward for Twitter's stockholders."

Daniel Ives, an analyst at Wedbush, said the company's board of directors had its back "against the wall" once Musk detailed his financing package and no other bidders emerged.

Twitter CEO Parag Agrawal said: "Twitter has a purpose and relevance that impacts the entire world. Deeply proud of our teams and inspired by the work that has never been more important."

The San Francisco-based company, founded in 2006, said Musk secured $25.5 billion of debt and margin loan financing and is providing a $21 billion equity commitment.

Twitter's relevance as a mouthpiece for politicians, political dissidents and activists belies its relatively small size.

After Twitter banned former president Donald Trump over concerns around alleged incitement of violence following last year's US Capitol infiltration by his supporters, Musk tweeted: "A lot of people are going to be super unhappy with West Coast high tech as the de facto arbiter of free speech."

Republicans on Monday cheered the deal while Democrats struck an apprehensive tone.

"Hey, @elonmusk it's a great week to free @realDonaldTrump," the House Republican Conference, which represents 209 lawmakers, said in a tweet referencing Trump's former Twitter user name.

But Trump, whose company is building a rival to Twitter called Truth Social, said he will not return to Twitter.

"I am not going on Twitter, I am going to stay on Truth," Trump told Fox News. "I hope Elon buys Twitter because he'll make improvements to it, and he is a good man, but I am going to be staying on Truth."

US Representative Jim Jordan of Ohio, a member of the Freedom Caucus of conservative House Republicans, said he hoped the deal would go through.

"I think this deal looks like it's good for the shareholders; second, it's good for free speech, it's good for the First Amendment," Jordan said in an interview with Fox News.

US Senator Elizabeth Warren, a Massachusetts Democrat tweeted: "This deal is dangerous for our democracy. Billionaires like Elon Musk play by a different set of rules than everyone else, accumulating power for their own gain. We need a wealth tax and strong rules to hold Big Tech accountable."

Former US labor secretary Robert Reich tweeted: "When billionaires like Elon Musk justify their motives by using ‘freedom,' beware. What they actually seek is freedom from accountability."

Speaking with reporters Monday, White House press secretary Jen Psaki said: "No matter who owns or runs Twitter, the president has long been concerned about the power of large social media platforms, the power they have over our everyday lives."

Reuters reporter Andrea Shalal pressed Psaki further about the deal.

"Are you concerned about the purveyors of election misinformation, disinformation, health falsehoods ... having more of an opportunity to speak there on Twitter? Is there ... any message that you would convey to Elon Musk as the new owner?" she asked, noting that publicly traded companies face "different levels of scrutiny" compared with private companies.

"I would say our concerns are not new, including Twitter and others, in order to spread misinformation, disinformation, the need for these platforms to be held accountable," Psaki replied.

A left-leaning nonprofit media watchdog group, Media Matters for America, also expressed concern.

"There is still time for Twitter's board to prevent some of the worst harms. Any negotiations to sell Twitter to Musk must include clear enforceable mechanisms to uphold and maintain existing community standards, including the removal of those who violate those standards," said Angelo Carusone, president of the nonprofit group.

In an editorial, The Wall Street Journal wrote that "it will be fascinating to watch Mr. Musk try to break Silicon Valley's culture of progressive conformity".

A day after Musk's unsolicited offer came, Twitter adopted a so-called poison pill, designed to make it more difficult for Musk to reach more than a 15 percent stake in the company by diluting the stock, or making more shares available at a discount to current holders.

Twitter changed its stance after Musk detailed elements of his financing plan for the takeover. On April 21, he said he had $46.5 billion in funding lined up. Twitter shares surged, and company executives opened the door to negotiations.

In January, Musk began accumulating Twitter stock, eventually becoming the single-largest individual investor.

Earlier this month, Twitter invited Musk to join its board, but that would have prevented him from owning more than 14.9 percent of the company's stock. Musk initially agreed but then rejected the offer.

Monday's news sparked plenty of feisty commentary on Twitter.

"There are so many amusing aspects to the utter panic and meltdown of corporate media employees at the prospect of Musk's control of Twitter," tweeted journalist Glenn Greenwald to his 1.8 million Twitter followers. "Perhaps the funniest are ones who work at huge corporations owned by (Amazon.com founder Jeff) Bezos … other billionaires are lamenting billionaire control of media."

"Elon Musk is buying Twitter and everyone freaking out drives a Tesla," wrote Jimmy Failla, Fox Across America host.

Reuters contributed to this story.