A new filing released by the Securities and Exchange Commission on May 17 revealed further details of Elon Musk’s $44 billion deal to take Twitter private, giving the public a more complete picture of the negotiations leading up to the acquisition.
Notably, the filing details how Dorsey personally counseled Musk that the company would be better positioned under private ownership, ahead of Musk’s decision to buy the company outright. Musk subsequently offered Dorsey the opportunity to remain on the board despite his existing plans to depart, but Dorsey declined the offer.
Additionally, the document attests to a series of private meetings between Musk, current CEO Parag Agrawal, board chairman Bret Taylor, and directors Egon Durban and Martha Lane Fox, in which Musk openly weighed several options for his engagement with the company.
But the deal Musk struck to acquire Twitter at a price of $54.20 per share has been called into question by the Tesla CEO’s recent tweets, in which he suggests he was misled by Twitter’s claims that only 5 percent of active users were “bots,” or fake accounts. On May 13, Musk wrote on Twitter that the deal was “temporarily on hold,” but appeared to contradict this remark several hours later, saying that he was still “committed to acquisition.”
The looming threat of renegotiation has sent Twitter’s stock price into decline since the announcement of the deal, as many investors are fearful that the $54.20 per share payoff may not come to fruition. However, despite Musk’s misgivings about Twitter bots—and the potential to use them as leverage for renegotiation—there are significant barriers to reneging at this stage in the process, including a reported $1 billion “reverse termination fee” on Musk for backing out of the process.
Twitter’s board of directors has issued a statement reiterating its commitment to the terms of the deal, stating that board members “intend to close the transaction and enforce the merger agreement,” per the original terms.
