Twitter (NYSE:TWTR), one of the largest social media companies on the planet, is the center of attention today as Elon Musk has now submitted a formal offer for a buyout. As per the reporting by Bloomberg, Elon Musk has offered to buy Twitter at $54.20 per share, equating to a premium of 18.2 percent relative to yesterday’s closing price of $45.85. Twitter has 799.97 million outstanding shares. Consequently, Musk’s buyout offer equates to $43.36 billion. Musk has sent a letter to Twitter’s board, highlighting the reasons behind this move: Of course, today’s development is hardly surprising given Musk’s recent overtures. The CEO of Tesla had already purchased a 9.2 percent passive stake in Twitter back in March before commissioning an online poll on the social media giant’s free speech credentials. When Musk’s Twitter stake was officially reported last week, it unleashed a fierce wave of speculation, with Wall Street analysts chiming in as well. For instance, as we had noted in a dedicated post last week, Gordon Haskett’s head of event-driven research, Don Bilson, highlighted the fact that Elon Musk had sought assistance from Goldman Sachs and Silver Lake back in 2018 when he was mulling over the idea of taking Tesla private. Bilson laid emphasis on this connection between Silver Lake and Twitter to theorize that Musk might take the social media giant private: However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company. As a result, I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced. My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder. Twitter has extraordinary potential. I will unlock it." Bilson had then added: Amid this speculative fervor, the CEO of Twitter, Parag Agrawal, had offered Musk a seat on Twitter’s board. However, Musk formally declined this offer on the 11th of March. As per a filing with the SEC, the seat on Twitter’s board came with stringent conditions: Given these conditions, Musk’s rejection of a seat on Twitter’s board had unleashed speculation that the CEO of Tesla was planning to take over the company. Today’s development only brings this speculation to its logical conclusion. Meanwhile, Elon Musk has been sued by Twitter investors for delaying the disclosure of a 5 percent-plus stake in the social media giant beyond the stipulated timeframe. To wit, Musk had acquired a stake of at least 5 percent by the 14th of March and was bound to disclose this development within 10 days. The lawsuit alleges: On the other hand, the shares of the Trump-linked SPAC Digital World Acquisition Corp. (NASDAQ:DWAC) are tanking today. The SPAC aims to bring the Trump Media & Technology Group (TMTG) public. Bear in mind that TMTG is behind the recently launched TRUTH Social app, which is is geared primarily toward conservative-leaning Trump supporters. Readers should note that Elon Musk also remains quite popular in this demographic. Consequently, with the CEO of Tesla throwing his weight behind Twitter, a social media platform that has been the subject of scathing rants from former US President Trump, the threat to TRUTH Social’s attractiveness continues to grow, particularly when factoring in Musk’s inarguable star power.
