It wasn’t that hard to read the tea leaves, and predict that Tesla CEO Elon Musk would walk away from a merger with Twitter for $44 Billion.
The Twitter board received a letter from Musk on Friday, July 8th 2022, saying he is terminating his acquisition. Initially, Twitter could have insisted that Musk pay a $1 billion breakup fee – that he initially agreed to pay if the deal fell through. Twitter CEO Parag Agrawal has insisted he wants to complete the $44 Billion merger.
Back in March, 2022, Musk began feeding the buzz for his possible acquisition of Twitter. On April 4 2022, Musk acquired 9% of the social media company. He revealed in a regulatory filing that he had became the company’s largest shareholder investing around $3 Billion. Not long after that Elon Musk announced that he would merge with Twitter for $44 Billion.
Over the past few month, after creating a surrealistic rollercoaster for Twitter in the market – Musk is officially pulling out.
Bret Taylor, the chair of Twitter’s board was not amused. He tweeted a response that the Twitter board is:
“committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.”
This Friday, Twitter shares fell 5% to $36.81. Musk initially agreed to pay $54.20 per share (yes, that “4.20” part appears deliberate). At the same time, shares of Tesla bounced up 2.5% to $752.29 per share.
