Talks have turned cordial after a breakthrough between Twitter and would-be buyer Elon Musk, with bankers and lawyers preparing paperwork for a $44 billion buyout to be completed by the Oct. 28 court-issued deadline, according to people familiar with the matter.
The breakthrough follows months of accusations, public acrimony and a stalemate in early October over Musk’s statement that his offer was contingent on receiving $13 billion in debt financing, Bloomberg reported.
News of a potential closing comes after a roller coaster of events that started in April when Tesla founder and CEO Musk made an unsolicited bid worth more than $40 billion to buy Twitter and an agreement was announced.
Then Musk appeared to try and walk away from his offer. Twitter sued to force him to fulfill the contract. A judge delayed a planned trial set for Oct. 17 to give both sides more time to finalize the details. Then earlier this week, Twitter froze the equity awards accounts for employees in anticipation of the deal closing.
If the deal goes through, it will put the world’s richest man in charge of one of the world’s most influential social media platforms, with the potential to impact the company’s employees, users and online discourse generally.
For those who were hoping the deal would fall apart, this could be bad news. Potential investors are being told Musk plans to cut 75 percent of the 7,500 Twitter workforce, a person familiar with the matter told Bloomberg. Musk also plans to restore former President Donald Trump to Twitter and others who have been kicked off the platform. Twitter will loosen content moderation standards, that person said.
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A judge ruled that the deal must be closed by Oct. 28 or it will go to trial.
The main issue is how Musk will come up with the $44 billion needed to buy Twitter, Business Insider reported: “This isn’t one of those buy-now-pay-later situations.”
Musk has $12.5 billion in debt financing lined up from big banks, leaving about $32 billion still to come and not much appetite these days to get in on the action, Dan DeFrancesco wrote for Business Insider.
Musk will need to sell $5 billion to $10 billion of his Tesla stock to finance the deal, said Wedbush analyst Dan Ives.
With a net worth of $219.4 billion, Elon Musk is the wealthiest man in the world.
Tesla and SpaceX CEO Elon Musk speaks at the SATELLITE Conference, March 9, 2020. (AP Photo/Susan Walsh, File) / Twitter app, April 25, 2022 (AP Photo/Gregory Bull, File)