After initially rejecting Elon Musk’s overtures, Twitter’s board of directors said on Monday that it will accept Musk’s $44 billion offer for the firm, bringing an end to a weeks-long dispute over whether the company would accept Musk’s unsolicited proposal.
Twitter chairman Bret Taylor stated in a statement, “The Twitter Board completed a careful and extensive process to analyze Elon’s bid with a deliberate focus on value, clarity, and finance.” “The proposed acquisition will result in a significant cash premium, and we think it is the best way forward for Twitter’s investors.”
Musk originally proposed the $54.20-per-share deal on April 14, sparking a frenzy of speculation among Twitter executives and Wall Street analysts about whether Musk was serious. He is, as it turns out, very much so: Last week, Musk revealed the money for the proposal, which totaled $46 billion in stock and loans arranged by Morgan Stanley.
Twitter first sought to deter Musk, deploying a poison pill defense designed to make any takeover effort expensive. However, major shareholders are apparently putting pressure on Twitter to take Musk’s offer more seriously. The company’s stock has been declining in recent months, having lost over 60% of its value in the 12 months preceding Musk’s announcement in early April that he had made a big purchase in Twitter shares.
On Monday, Twitter shares surged 5.5 percent to $51.63 as investors processed the board’s decision. There is still a difference between the share price and Musk’s offer, indicating that investors feel there is still a chance something will go wrong with the acquisition, which the firm hopes to finalize later this year.