Twitter stock was shut down twice, a second time on the pending news, and rose about 13% at midday Tuesday after reports that Elon Musk suggested going ahead with his deal to buy the company at the originally agreed price of $54.20 per share.
Bloomberg and The Washington Post reported Tuesday that Musk sent a message to Twitter proposing that the deal go through as it was originally signed, citing people familiar with the negotiations.
Musk and Twitter representatives did not immediately respond to a request for comment.
This news comes as both sides prepare to head to trial in two weeks over Musk’s attempt to withdraw from the $44 billion takeover agreement, which Twitter has sued him to complete. Musk’s lawyers were due to oust Twitter CEO Parag Agrawal on Monday, and Twitter’s lawyers were planning to fire Musk starting Thursday.
Such an agreement could put an end to the months-long back-and-forth between Musk and Twitter, causing tremendous uncertainty for employees, investors and users of one of the world’s most influential social media platforms.
Twitter’s board of directors is likely to agree to a hold on litigation to move forward with closing the deal, according to Josh White, associate professor of finance at Vanderbilt University.
“The public saga has definitely taken a toll on them and the Twitter staff,” White said. “It is best for all parties to finish the deal and make a quick and smooth transition. I suspect it will close quickly.”
The saga began in April when Musk revealed that he had become the largest contributor to Twitter. Over the next few months, Musk agreed and then retracted an offer to sit on Twitter’s board, threatened a hostile takeover of the company, signed an agreement to buy the company, began raising concerns about bots on the platform, and attempted to terminate the agreement. A lawsuit was filed by Twitter to pursue deal and adding claims from a Twitter whistleblower to his argument.
Musk initially moved to close the deal, citing allegations that the company miscalculated the number of spam and fake accounts on the platform. Twitter alleged that Musk had breached the deal and was using bots as an excuse to exit a buyer’s remorse deal after a broader market downturn, which also hurt Tesla’s stock, and thus Musk’s personal fortune.
However, several legal experts said Twitter had a stronger case going to court, and that Musk would face a significant burden trying to prove that the company made material misleading statements in its securities filings or in the deal contract.
The lawsuit was the last remaining hurdle in the way of closing the deal, after Twitter shareholders voted last month to approve the deal. The deal was originally scheduled to close this month.
With news that the deal could end in closing, attention may once again turn to what Musk’s takeover of the social media platform could mean.
Musk has previously proposed a series of potential changes to Twitter, the most important of which is the return of former President Donald Trump to the platform and the removal of permanent bans on the accounts. Musk also said he wants Twitter to be more open to “freedom of expression” and could change its content editing policies.
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