• In early April, Musk initially buys a block of Twitter stock, so he wants the entire company
• A hostile takeover becomes a peaceful settlement
• Then Musk no longer wants to buy Twitter, but he has to
Hardly anyone would have thought at the beginning of the year that the Twitter stake would no longer be freely tradable on the stock exchange at the end of 2022. Also the reason for this: the acquisition by Elon Musk – could not have invented the best storytellers. But in October 2022, the Twitter buyout of Elon Musk became a reality. However, the acquisition was far from a simple process: first Musk wanted to buy Twitter, but then he decided against it, in the end he had to. How did this confusion arise?
Early April: Musk buys a large block of Twitter stock and is eligible to join the board of directors
On April 4, Elon Musk’s buildup of a large Twitter stake went public. According to a US Securities and Exchange Commission (SEC) filing, by then he had already bought a whopping $2.9 billion worth of Twitter stock, equivalent to 73.5 million Twitter shares. Musk quickly became the online news service’s largest single shareholder: 9.2% of the company was in his hands at the time. Noting Musk’s significant stake in the company, then-Twitter CEO Parag Agrawal announced on April 5 that the Tesla CEO would be moving to Twitter’s board of directors.
Mid-April: Musk launches hostile takeover attempt
Five days later, it was revealed that Musk had turned down the board position offered by Agrawal. The sensational news followed on April 13: Musk started with a hostile takeover of Twitter. He announced that he would buy shares of Twitter shareholders at a price of $54.20 each. This was quite a lucrative deal for the owners of Twitter’s shares, as the shares were just under US$40 immediately before the April 1 takeover bet. Shares of Twitter soared after the announcement but fell short of $54.20 as investors didn’t quite trust the deal. There were good reasons for investor distrust, as would become apparent in the following months.
Late April: Twitter and Musk reach agreement together
Another interesting twist followed on April 25: Instead of the attempted hostile takeover of Musk, a temporary deal was reached between the news platform and the world’s richest man: the tech multi-billionaire would take over Twitter and pay the sum. of 44 dollars. billions of dollars. The share price remained at the previously announced $54.20. Musk has promised that he will make Twitter “better than ever”. He wants to turn it into a “global platform for free speech” without any censorship. However, most media pundits were skeptical and expressed fears that Musk would limit his fight against fake news and hate speech. The May 10 announcement of the boss Tesla, former president Donald Trump Wanting to allow it again gave critics further cause for concern.
Mid-May: Musk suspends plans to buy Twitter
The apparent harmony between Musk and Twitter’s leadership was short-lived. On May 13, Musk abruptly put his buying plans on hold. Until there are details on the calculation of the number of spam and fake accounts on the net, the Tesla CEO does not want to take over the news platform.
Early July: Musk cancels acquisition of Twitter, but Twitter wants to sue
On July 8, the previous speculation became official: Musk canceled the purchase of Twitter. His lawyers have accused the US company of making “false and misleading” statements in the acquisition deal. The main point of controversy was still the alleged spam and fake accounts. At this point, it looked like Musk wasn’t going to buy Twitter after all. At least he’d probably lost interest in it, but Musk seemed to have made the bill without Twitter. Soon after Musk’s refusal, Twitter announced it would force the tech billionaire to buy the platform as part of a judicial process.
July to October: Twitter initiates proceedings against Musk
On July 12, Twitter filed a lawsuit against Musk in a Delaware commercial dispute court. The charge was breach of contract. Several procedural steps followed and the start of the actual trial was set for October 17th. At this point, everything seemed headed towards a court hearing, but even those expectations would ultimately be proven wrong.
Early October: Musk seeks reconciliation with Twitter
On October 4, Musk then made another unexpected u-turn: he wanted to buy Twitter all in all under the conditions agreed in April. The only prerequisite for his new takeover offer: the judicial process is cancelled. Responsible Judge Kathaleen McCormick responded to this request and called on Musk and Twitter to reach a joint solution. You have postponed the court date to October 28th.
October 27: Musk officially takes control of Twitter: Twitter’s shares are no longer tradable
One day before the deadline, the moment had finally arrived: Musk officially became the sole owner of Twitter. On October 27, shares of Twitter were delisted from the NYSE, paying shareholders an agreed $54.20 per share. Musk immediately initiated a massive restructuring of the company: the management team around former CEO Agrawal and CFO Ned Segal were fired and many senior figures resigned. On November 4, Musk then continued the job cuts on Twitter: 3,738 of which 7,500 employees received their unsubscribe by email. In addition, Twitter has had to accept a significant drop in sales, as international companies such as Volkswagen, Mondelez and Pfizer, as well as advertising giant IPG, have suspended their advertising on the online service following the Musk takeover. So it was far from an easy start for Musk as the new owner of Twitter, especially since Tesla’s stock also suffered from their CEO’s Twitter antics and lost a lot of value in the fall of 2022.
finanzen.ch editorial team
