This Friday, October 28, 2022, Elon Musk closed his deal and purchased Twitter for $44 billion. After months of statements, intentions, offers and judicial investigations, the richest man on the planet made good on his word to buy the social network.
The story began by purchasing a few Twitter shares and concluded with "the bird is freed."
73,486,938 shares in just two months
On January 31, 2022, Musk began buying Twitter shares virtually every day until, by March, he had a significant stake in the Tech Giant: more than 5%.
It was in March when the first contact between Elon Musk and Twitter founder Jack Dorsey took place. In this conversation, both presented their different views on the future of social media. A day after meeting with Dorsey, Musk conveyed to senior Twitter executives his intention to join the board and take the social network off the stock market.
In just over two months, Musk went from owning one share to owning almost 10% of the total. On April 4, Musk reported that he now held 73,486,938 common shares (9.2%), valued at $2.89 billion. Due to his high stake in the company, Twitter informed the Securities and Exchange Commission (SEC) that Musk would become a Twitter director until 2024.
Offer to purchase
Six days after Twitter petitioned the SEC for Musk to join Twitter's board of directors, the company's then CEO, Parag Agrawal, posted that Elon Musk would not be joining the board:
Elon has decided not to join our board.
Elon has decided not to join our board. I sent a brief note to the company, sharing with you all here. pic.twitter.com/lfrXACavvvk
- Parag Agrawal (@paraga) April 11, 2022
The first key day of the Twitter buyout was April 14. Musk offered $44 billion to purchase of all Twitter shares, i.e. he would pay $54.20 for each share of the Big Tech stock. Twenty four hours later, Twitter responded and said it would halt Elon Musk’s buyout.
Despite Twitter's refusal, a week later the company agreed to Musk's $44 billion purchase. The new owner of Twitter announced that he would reactivate Donald Trump's account.
Judicial investigations and lawsuits
When the purchase appeared to be on track, Musk derailed the deal and, although he claimed he was still "committed" to his acquisition, the purchase was "totally on hold" due to the fact that he wanted more insight into the fake accounts. On May 17, Musk confirmed that his offer could not “go forward" because he had concerns about the number of fake accounts on the social media platform:
My offer was based on Twitter's SEC filings being accurate. Yesterday, Twitter's CEO publicly refused to show proof of <5%. This deal cannot move forward until he does.
20% fake/spam accounts, while 4 times what Twitter claims, could be *much* higher.
My offer was based on Twitter's SEC filings being accurate.
Yesterday, Twitter's CEO publicly refused to show proof of <5%.
This deal cannot move forward until he does.
- Elon Musk (@elonmusk) May 17, 2022
The problems and judicial investigations began on June 3. Twitter said Musk had to go ahead with his acquisition after shareholders approved it. Musk's legal team defended his right not to buy the social network through a letter after the Big Tech company failed to provide truthful documentation about the fake accounts. Because of this, Texas Attorney General Ken Paxton agreed to investigate Twitter for filing false reports. On June 8, Twitter agreed to hand over private data to Musk.
But this legal problem did not end there. Twitter did not keep its word and did not deliver the documentation, as claimed by Elon Musk. As a result, on July 8 Musk again attempted to abandon his purchase transaction.
In the letter announcing that he was withdrawing from purchasing the social network, Elon Musk alleged several breaches by Twitter, the main one being the failure to provide information about fake accounts. In addition, he accused them of making decisions without his consent regarding the hiring and firing of personnel.
Musk offered no proof of these allegations, so Twitter might have a chance of winning the lawsuit against the entrepreneur. This is something Elon Musk himself might have foreseen.
"The bird is freed"
On July 12, Twitter sued Musk for refusing to buy the company and forcing him to comply with its intent. The trial was to be held in a Delaware court. The new owner tried to postpone this lawsuit, but failed, so that legal battle was won by Twitter.
In early October, Elon Musk backtracked and proposed to acquire Twitter for the same price he offered in April. However, the businessman was investigated by the courts for alleged misconduct during the entire process of acquiring Twitter. The Delaware judge investigating Musk ruled that the entrepreneur must execute his purchase transaction by October 28.
Musk kept his word and his intention to become the new owner of Twitter. On October 26, he entered the company's headquarters in San Francisco to formalize the transaction while carrying a sink.
Entering Twitter HQ - let that sink in! pic.twitter.com/D68z4K2wq7
- Elon Musk (@elonmusk) October 26, 2022
A day after entering the offices, Musk issued a statement to reassure advertisers that he will prevent the social network from falling "into far right wing and far left wing echo chambers that generate more hate and divide our society." On October 28, Twitter's new owner posted: "the bird is freed."
the bird is freed
- Elon Musk (@elonmusk) October 28, 2022