The world’s richest man Elon Musk set in a motion a formal and audacious move to take a controlling stake in micro-blogging site Twitter on Thursday in a hostile takeover, meaning he does not have in his plan to approach the management for their consent but will negotiate with shareholders instead.
The tender offer is the culmination of a push which, 10 days ago spurred a purchase by Mr Musk of a $2.9 billion worth of stake in the company catapulting him to its top hierarchy of ownership.
He is offering $54.20 per share in a non-binding proposal to acquire all the outstanding shares of Twitter, which translates to “a 54 per cent premium over the closing price of the common Stock on January 28, 2022,” the day he began investing in the company, according to a filing with market watchdog the U.S Securities and Exchange Commission.
Seen another way, the offer is equivalent to a “38 per cent 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.”
Twitter’s shares gained as much as 18 per cent in pre-market trading, with Mr Musk affirming that the company is brimming with prospects. He has rejected a potential board seat at Twitter.
Mr Musk could achieve his goal, given that he has an eye for picking out firms where investment could bring tremendous yield especially with the success of his electric car-making company Tesla, whose profit hit an all-time peak last year after sales more than 71 per cent to $53.8 billion.
His push to take a majority stake in the social media platform is the latest phase of his complicated relationship with Twitter on whose platform he has above 80 million followers.
Mr Musk has never refrained from voicing out the adjustments he will make to the platform. His wealth estimated to be in the region of $260 billion according to the Bloomberg Billionaire’s Index.
Twitter is valued at $37 billion using open market valuation.
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