On Sunday, the Twitter board of directors met to discuss Elon Musk’s takeover offer, which has turned serious. The meeting signals that the company’s 11-member board is becoming receptive to this deal and plans to meet Tesla’s CEO to discuss other contours surrounding this deal. These details include the timeline to close the potential deal and fees to be paid if an agreement is signed.
Although none of the participants commented about this meeting, the Twitter board seems to be taking a fresh look at this offer. According to his filing with SEC last Thursday, Musk confirmed that he had lined up $46.5 billion in the form of financing for this buyout. This is the driving factor behind this meeting.
Musk’s offer is set to change this social media from a public company to a private one unless there is a second bidder. Further, a hostile tender off will begin in case the board officially rejects Elon Musk’s bid. That means Musk will take his bid to the company’s shareholders or what is called a “tender offer.” This is a scenario where an outsider (s) circumvents the board and asks the company’s shareholders to sell their shares to them directly.
Twitter’s shares are currently trading at $49 a share, while Musk’s offer is $54.20 a share. The social networking service will announce its quarter earnings coming Thursday afternoon. It’s also expected that the board will address this offer before or by then.
On Sunday night, Twitter released a statement that said, “As previously announced, the board is continuing to conduct a careful, comprehensive, and deliberate review to determine the course of action in the best interest of the company and all Twitter stockholders.”
Many analysts and Wall Street view the board’s openness to Tesla’s CEO bid as the beginning of the end of the social media service as a public company. Musk wants to “transform” Twitter and make it a “platform for free speech around the globe.” He also wants to make vast improvements to its policies and products.