The Elon Musk - Twitter saga comes to an interesting conclusion

Elon Musk smiles next to a makeshift to-do list checking off Tesla and Twitter depicting Musk buying Twitter recently

Early April came with the mind-boggling news that Elon Musk had been stashing away shares of Twitter Inc (TWTR: US). In an SEC filing unmasked on April 04, Musk was revealed to be 9.2% shareholder of the social media platform. His share percentage surpassed that of any of the company’s directors, or even the founder - Jack Dorsey - himself. 

In less than a month, news headlines and social media were raging and talking about Musk’s actions and possible plans for the company. 2iQ previously covered the first chapter of this story, which ended with Twitter CEO Parag Agrawal inviting him to the company’s board of directors. A week after the SEC filing’s unveiling, Elon Musk announced that he would not be joining the company. But this still left speculation as to how the story would go forth. 

On April 14, the CEO of Tesla made an offer: Buying Twitter for $43 billion and turning it into a private company. In the filing, Musk said: I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy. However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form.” He offered to purchase the company at $54.20 per share, a 54% premium over the day before his first investment, and a 38% premium over the day prior to his investment being made public.

The news came as a giant red flag to Musk’s critics who were concerned about the changes the social media site would undergo, as well as the blocking of some existing Twitter users and the returns of some others. Unsurprisingly, the Twitter board’s response to this was not warm and adopted a poison pill the next day to stop Musk’s take over. The pill meant that Twitter’s shareholders would be allowed to buy additional TWTR shares albeit at discounted prices with each share’s price diluted. 

The poison pill strategy would have coerced Musk to spend more money than the existing billions. In the same week, Apollo Global Management’s interest surged and it considered competing in a bid for Twitter. Other possible candidates that came forth included Thoma Bravo LP, which offered to put together an acquisition deal to counter Musk’s proposal. The source also stated that Twitter was largely expected to refuse Musk’s offer but details would come out on the company’s earnings announcement, which is due on April 28. 

Like a movie playing out, the entire roller coaster of headlines ended in a climax on Monday, April 25, when Twitter announced that it had accepted Elon Musk’s offer. The company was sold for $44 billion and entailed all the details of Musk’s first offer. 

The news came as a blow to many Twitter users who even began deleting their accounts in the wake of Musk’s ownership. The same day Elon tweeted:


While the deal seems to have come to a full close, the story it appears will be having a sequel sooner than expected. On Tuesday, the entire stock market underperformed but TSLA shares fell by a shocking 12.18%. Much of the reason can be attributed to Tesla investors’ worries that Musk would have to sell his shares of the EV manufacturer to fund his Twitter buyout. 

One article gave more reasons for the price fall of TSLA: Tesla is currently undergoing an agreement to export vehicles to India, which has been facing sidetracks along the way. Another possibility was that Musk would never go through with the Twitter deal; even when the first buyout was unveiled, netizens speculated whether Musk was serious about acquiring the platform or just trolling - one of the things he is famous for. Lastly, there is the Politics pool which has been shaken by this billion-dollar deal as well. Sen. Elizabeth Warren (D-MA) tweeted recently:


The end to this less-than-a-month long saga is a cliffhanger: no one knows about Musk’s plans for Twitter in the long term and Tesla is just as worried.

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