Musk is offering a 54% premium over the Jan. 28 closing price, the date after which he began building his initial stake in Twitter. The takeover is unlikely to be a drawn-out process.
“If the deal doesn’t work, given that I don’t have confidence in management nor do I believe I can drive the necessary change in the public market, I would need to reconsider my position as a shareholder,” said Musk.
Shares have fluctuated as Elon Musk builds stake
Musk informed Twitter’s board over the previous weekend that he thought the company should be taken private, according to today’s statement.
The $54.20 per share offer is “too low” for shareholders or the board to accept, said Vital Knowledge’s Adam Crisafulli in a report, adding that the company’s shares hit $70 less than a year ago.
Although Musk said his offer was “best and final,” it opens the gates to rivals, either to team up or out-bid his offer. Oracle CEO Larry Ellison, also on the board of Tesla, previously attempted to buy a stake in social media platform TikTok.
Musk has hired Morgan Stanley as his adviser for the bid. The offer price also includes the number 420, widely recognized as a coded reference to marijuana. He also picked $420 as the share price for possibly taking Tesla private in 2018, a move that brought him scrutiny from the SEC.
“There will be host of questions around financing, regulatory, balancing Musk’s time (Tesla, SpaceX) in the coming days,” said Dan Ives, analyst at Wedbush. “But ultimately based on this filing it is a now or never bid for Twitter to accept.”
--With assistance from Zac Fleming and Ryan Vlastelica.
This article was provided by Bloomberg News.