Billionaire and Tesla CEO Elon Musk has offered to buy Twitter, take the company private and build it into a platform for “free speech,” according to a filing made to the U.S. Securities and Exchange Commission Wednesday, days after he purchased around 9% of the company and then turned down an offer to join its board.
In the SEC filing, Musk says he is offering to buy 100% of Twitter at $54.20 per share in an all-cash transaction and then take it private.
Musk noted that he believes in Twitter’s potential to become a free speech platform and serve a key “societal imperative.”
The Tesla CEO says he is making the current offer after realizing that the company will “neither thrive nor serve this societal imperative in its current form,” arguing that it needs to be taken private.
Musk adds that his offer of $54.20 per share is his “best and final offer” and if it is not accepted he will need to “reconsider” his position as the company’s largest shareholder.
Twitter responded to Musk’s move in a press release stating that its board will review the offer and determine its course of actions with the best interest of the company and its stockholders in mind.
The price of Twitter’s stock stood at around $51.41 during pre-market trade early on Thursday, up more than 10%.
$43 billion. That is the approximate valuation of Twitter as per Musk’s offer, which the billionaire notes is a 54% premium over the company’s value the day before he began investing in it.
Commenting on Musk’s takeover attempt, analysts from Wedbush Securities said: “Musk previously had a 9.2% stake before the filing this morning and now ultimately we believe this soap opera will end with Musk owning Twitter after this aggressive hostile takeover of the company.”
Musk’s offer of $54.20 may be a dig at the SEC which had previously pulled him up for indicating that he wanted to take Tesla private at $420 per share. At the time, the regulator noted that the $420 per stock offer—a 20% premium on Tesla’s stock price at the time—was a reference to marijuana and Musk’s belief “that his girlfriend would be amused by it.”
Last week, Musk disclosed that he had acquired a 9.2% stake—later revised to a 9.1% stake—in Twitter worth around $3 billion. The acquisition made Musk the social media company’s largest shareholder, prompting its CEO Parag Agrawal to offer him a seat on Twitter’s board. A key caveat of the boardroom seat was that Musk would have to agree to acquire no more than 14.9% of the company, shielding Twitter from a hostile takeover. Musk eventually turned down the offer. The billionaire has repeatedly accused Twitter of failing to adhere to free speech principles and undermining democracy.
Musk’s attempt to outline his vision of Twitter as the “free speech platform” appears to have had an impact on Truth Social, the Twitter clone backed by former president Donald Trump. Digital World Acquisition Corp., the special purpose acquisition company (SPAC) that plans to take Trump’s platform public, saw its shares drop more than 5% in pre-market trading early on Thursday. The SPAC has seen its value crater significantly in the past month as the self-styled “free speech” alternative to Twitter failed to gain traction since its launch. Meanwhile, Tesla’s stock was also down more than 2% in pre-market trading.
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