Monday, November 28, 2022
HomeEconomicsElon Musk is definitely buying Twitter this time. Maybe

Elon Musk is definitely buying Twitter this time. Maybe


This week Elon Musk offered to buy Twitter for $44 billion or $54.20 a share – again.

The Wikipedia entry of the proposed takeover already exceeds 5,300 words – an impressive feat considering it’s been less than six months since Musk first struck a deal to buy the company (for the same amount), and just three months since the billionaire announced he was ditching it. Twitter sued him days later, on July 12.

Here’s the TL;DR of all the major developments since Musk began to get cold feet in mid-May, and one way he could still wriggle out of deal.

Elon Musk

May 13: Musk tweets that he is putting the Twitter deal on hold until the platform provides proof that fake or spam accounts comprise less than 5% of users, as it claims.

June 6: He threatens to end his $44 billion deal to buy Twitter, saying it refused to give him information about such accounts.

July 8: Musk says he will abandon his offer to buy Twitter. The company threatens to sue him.

July 12: Twitter sues Musk to force him to complete the deal. Musk countersues.

July 19: A judge says the legal dispute will go to trial in October.

August 23: A former head of security at Twitter turns whistleblower, alleging the company misled regulators about its poor cybersecurity defences and its negligence on removing fake accounts that spread disinformation.

Musk cites the whistleblower as a new reason to scuttle the deal.

October 4: Musk offers to go through with his original proposal to buy Twitter for $44 billion, days before he was due to be questioned as part of the preparation for the October 17 trial.

Twitter says it intends to close the transaction after receiving Musk’s offer. The New York Times reports that Musk’s lawyers had spent the previous few weeks negotiating with the company for a lower price.

October 6: Musk asks the court to stay the trial, saying the deal could close on or around October 28.

October 7: The judge postpones the trial to October 28 to give Musk time to raise $44 billion and close the deal.

AP reports, citing experts, that Musk still faces a huge obstacle to closing the deal. Behind the scenes, they say, banks could be scrambling to find buyers for $12.5 billion in debt from the deal, while Musk tries to hold together a group of equity investors that is pitching in billions more.

Given that Musk’s agreement with Twitter was contingent on him securing the necessary financing, he could still find a way out of this self-created mess.

Don’t put the popcorn down just yet.

Written by Zaheer Merchant in Mumbai


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