Elon Musk has agreed to a $44 billion deal to buy Twitter in a takeover that will give the world’s richest man control of a social network with more than 200 million users.
The sale will put Tesla’s chief executive in charge of a company he has frequently criticized, saying it has failed to live up to its potential as a platform for “free speech.”
Monday’s deal comes after a dramatic few weeks of speculation about Twitter’s future, sparked by Musk’s appearance as the platform’s largest single shareholder on April 4. He then declared a takeover bid on April 14, offering to buy all of Twitter’s shares for $54.20 each.
At first, Twitter’s board of directors seemed opposed, enacting an anti-takeover measure known as a poison pill that could have made a takeover attempt prohibitively expensive. But his initial reluctance to agree to a transaction seemed to fade after Musk confirmed a financing package for the deal, which includes $21 billion of his own money, along with debt financing from Morgan Stanley and other financial institutions, and shareholders. they accepted it.
“Freedom of expression is the foundation of a functioning democracy, and Twitter is the digital public square where issues vital to the future of humanity are debated,” Musk said in a statement posted on Twitter. “Twitter has enormous potential; I look forward to working with the company and users to unlock it,” he added.
🚀💫♥️ Yesss!!! ♥️💫🚀 pic.twitter.com/0T9HzUHuh6
— Elon Musk (@elonmusk) April 25, 2022
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Twitter said the transaction had been unanimously approved by its board of directors and was expected to close in 2022, pending regulatory approval and shareholder approval.
“Twitter has a purpose and relevance that touches the whole world,” Twitter CEO Parag Agrawal said in a tweet confirming the sale. “Deeply proud of our teams and inspired by the work that has never been more important.”
Agrawal will reportedly host an all-employee meeting on Monday afternoon to address the news. Musk’s acquisition has been unexpected and controversial among Twitter employees. Twitter has 217 million users.
The company, which launched in 2006, currently has a market capitalization of nearly $40 billion. Its co-founder, Jack Dorsey, stepped down as CEO in November 2021, handing the reins over to Agrawal, the company’s former chief technology officer.
Musk is a prominent user of the app, with 83 million followers, and tweeted as early as 2017 expressing interest in buying the company. He has pointed out that Twitter must become a private company to build trust with users and better fulfill what he calls the “social imperative” of freedom of expression.
“I hope even my worst critics stay on Twitter, because that’s what free speech means,” he tweeted Monday.
How Musk will reshape the company remains to be seen, but the billionaire has proposed several changes in recent weeks. They include relaxing its content restrictions, ridding the platform of fake and automated accounts, and moving away from its ad-based revenue model.
Explaining his goals, Musk added Monday that he wanted to “make Twitter better than ever by improving the product with new features, making the algorithms open source to increase trust, defeating spam bots, and authenticating all humans.”
Musk has long been a popular, if contentious, figure on the platform. And despite claiming to be a “free speech absolutist,” Musk regularly blocks social media users who have criticized him or his company and has used the platform to intimidate reporters who have written critical articles. about him or his company.
The deal is not expected to face serious scrutiny from US competition authorities because Musk’s other major business interests (Tesla, an electric car company, rocket business SpaceX and tunneling company The Boring Company) do not compete with Twitter.
However, it is likely to draw comment from politicians and campaign bodies given Twitter’s influence as a source of information and Musk’s stance on free speech. The purchase also comes amid intensifying criticism of Big Tech’s power and underscores the ability of wealthy executives to control platforms used by millions.
“No matter who owns or manages Twitter, the president has always been concerned about the power of the big social media platforms,” White House spokeswoman Jen Psaki said. commented on Monday shopping.
Rebecca Allensworth, a law professor at Vanderbilt University, called the deal “troubling.”
“There is something deeply troubling about a private company having the power Twitter has over public discourse, especially if Twitter is to be controlled by someone with as idiosyncratic views on speech as Musk. The US free speech law is essentially just the first amendment, which only restricts government actors, not a company like Twitter or a person like Elon Musk,” he said.
Speculation has already begun about whether Musk will reinstate high-profile accounts that were previously removed for violating community guidelines, including Donald Trump’s. Trump was permanently banned from Twitter in 2021 for his use of the platform to incite riots at the US Capitol.
After the deal was announced, the NAACP issued a statement urging Musk not to allow the 45th president back on the platform.
“Disinformation, misinformation and hate speech have NO PLACE on Twitter,” the civil rights organization said in a statement. “Do not allow 45 to return to the platform. Don’t let Twitter become a petri dish for hate speech or falsehoods that subvert our democracy.”
Trump has so far said he would not return to Twitter if his account was reinstated, telling Fox News on Monday, “I hope Elon buys Twitter because he’s going to make it better and he’s a good man, but I’m going to be staying on Truth.” reference to his own startup Truth Social.
Suzanne Nossel, executive director of PEN America, a nonprofit organization that works to protect free speech in the US, and a member of Facebook’s Oversight Board, warned Musk not to turn himself in to the “ fantasy” of dismantling the moderation guidelines.
“Elon Musk will learn the same lesson about autonomous social networks as he does about autonomous vehicles, which is that they inevitably collide. Musk is correct that our current content moderation systems are biased and flawed, but the idea that rules can be removed entirely is fallacious,” Nossel said.
Musk is the richest person in the world, according to Forbes, with a fortune of nearly $279 billion. He began building wealth for himself in 1999 when he sold Zip2, an online map and business directory, for $307 million. He used part of it to create what would become PayPal, sold to eBay for $1.5 billion in 2002.
That same year, Musk founded Space Exploration Technologies, or SpaceX, after discovering that cost constraints limited NASA’s interplanetary travel. The company eventually developed profitable reusable rockets.
In 2004, Musk was courted to invest in Tesla, then a startup trying to build an electric car. He eventually became CEO and led the company to success as the world’s most valuable automaker and the largest seller of electric vehicles.
Twitter shares rose 5% on Monday to $51.50 a share on news of the sale.
Agencies contributed reports