Elon Musk is likely to close the deal to buy Twitter Inc by the end of this week. In April this year, the SpaceX and Tesla CEO proposed to buy the social media platform. The bid valued at $44 billion is touted to be among the biggest buyout deal in recent times.
For the acquisition, the Tesla CEO has pledged to provide $46.5 billion in equity and debt financing. Morgan Stanley and Bank of America Corp, amongst other banks, have committed to provide funding worth $13 billion as debt financing to Musk. Apart from this, Larry Ellison, the co-founder of Oracle Corp and Saudi Prince Alwaleed bin Talal have also committed $7.1 billion.
However, the past couple of months saw events that led to the speculations that the Musk-Twitter deal might not make through. This includes Twitter deploying the ‘poison pill’ to thwart the hostile takeover by Musk and the legal battle between the Tesla CEO and the social media platform after he pulled out of the buyout deal.
Here is a timeline for the events that unfolded in the past couple of months:
January 31: Musk starts buying Twitter shares, thus increasing his stake in the social media platform.
March 14: Musk’s stake in Twitter increases to 5%, however, he misses disclosing the stake to the US Securities and Exchanges by 10 days, which would involve a legal battle with shareholders later.
March 24: Musk begins criticising Twitter. In one of his tweets, he asks the users of the social media platform if “a new platform is needed.”
April 4: Musk becomes the largest shareholder of the social media platform by having a 9.2% stake in Twitter. A day later, Twitter CEO Parag Agrawal informs that Musk will be joining the Twitter board. The same day, Musk suggests introducing the edit button for Twitter. Later, the social media platform says it is working to test the edit button for the microblogging website.
April 9: Musk rejects Twitter’s offer to join its board and starts criticising the social media platform again. In one of his tweets, he cites the World of Statistics report and tweets “Is Twitter Dying?” He also suggests a slew of changes for Twitter including converting Twitter’s San Francisco office to a homeless shelter and removing ‘w’ from the word Twitter.
April 10: Agrawal informs that Musk has refused to join Twitter.
April 13: Some Twitter investors file a complaint in the New York Federal Court over Musk’s stake in the social media platform saying he delayed revealing his stake in Twitter in order to buy the shares at a cheaper price.
April 14: A series of events take place. In an SEC filing, Musk says he would buyout the social media platform for $43 billion. He offers a $54.20 per share deal at a 54% premium to the closing price of Twitter’s stock on April 1, which is the last trading day before the Tesla CEO bought the majority stake in the company. Morgan Stanley is appointed as an advisor to Musk for the bid. In a letter to Twitter chairperson Bret Taylor, he says this is his ‘best’ and ‘final’ offer. Amongst the clamour, Agrawal reassures the disgruntled Twitter employees that the social media platform is not held hostage by Musk’s offer. The same day, in a turn of events, Pennysylvania-based Vanguard Holdings becomes the largest shareholder of Twitter by acquiring a 10.3% stake in the company. At a public discussion, the Tesla CEO says he is not sure about buying Twitter, and if his buyout deal fails he has a Plan B.
April 16: To thwart the hostile takeover, Twitter launches poison pill as defence. For the next couple of days, his tweets fuel speculations regarding a tender offer to buy the social media platform.
April 21: In an SEC filing, Musk reveals he has secured worth $46.5 billion in funding to buy Twitter. Of this, he has secured $25.5 billion in debt financing from Morgan Stanley and other banks, and $21 billion in equity financing himself.
April 25: Twitter shareholders, after discussions with Musk, agrees to his buyout proposal worth $54.20 per share.
April 29: Musk sells Tesla shares worth $8.5 billion.
May 5: Musk raises funding worth $7 billion from a group of investors including Oracle co-founder.
May 10: Musk suggests that once his takeover bid gets completed, the Twitter ban on former US President Donald Trump would be lifted.
May 13: Asking Twitter to provide details of the spam/fake accounts indeed represent less than 5% of users, Musk puts the Twitter deal on hold. “Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” he tweets.
May 16: In a response to Musk’s tweet, Agrawal tweets that measuring spam accounts in the social media platform. Musk however rejects Agrawal’s response. A day later, Musk threatens to pull out of the deal if the social media platform doesn’t prove that bots made upto less than of 5% of its users’ base.
July 8: The Tesla CEO pulls out of the Twitter deal, citing misleading representations by the social media platforms over the number of spam bots.
July 12: In order to sue Musk for backing out of the buyout deal, Twitter hires Wachtell, Lipton, and Rosen & Katz. It files suit against the SpaceX CEO in a Delaware Chancery Court. Musk hires Quinn Emanuel Urquhart & Sullivan to defend his case.
October 4: In order to avoid a legal battle, Musk revives his bid to take over the social media platform at the original offer price of $54.20 per share. The Delaware Court has given the October-28 deadline to Musk to complete the acquisition.
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