Twitter board asks shareholders to approve Elon Musk’s $44 billion bid News ▸ US ▸ Investments
Twitter board asks shareholders to approve Elon Musk’s $44 billion bid
Musk's offer for Twitter would earn each shareholder $54.20, which is ahead of the current value of the shares at $38.
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Updated: Jun. 21, 2022 at 6:40 pm UTC
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Twitter’s board unanimously recommends that shareholders vote for Elon Musk’s $44 billion bid to take over the social media company, a June 21 SEC filing shows.
According to the filing, Musk’s offer for Twitter would earn each shareholder $54.20, which is ahead of the company’s current shares value of $38.
The board has urged the shareholders to vote in support of the merger agreement, the compensations that would be payable to Twitter executive officers, and the adjournment of the meeting due to insufficient votes.
Meanwhile, the merger has an Oct. 24 deadline, but a date has not been chosen for the shareholders’ votes.
Elon Musk’s protracted Twitter purchase
Elon Musk’s interest in Twitter has hit some snags as the richest man in the world had insisted that the social media site be more transparent about the number of bot accounts on its platform.
Those issues, however, appear to be in the past as Musk recently held a virtual meeting with Twitter employees. During the meeting, he hinted that the platform could integrate a payment system that allows cryptocurrency transactions.
Several analysts have opined that the virtual meeting is the latest signal that Elon Musk remains committed to completing the acquisition.
Who profits from the takeover?
If the shareholders ratify the takeover bid at the current value of Twitter shares, each shareholder would be pocketing around $15 for every stock they own in the company.
It means Jack Dorsey, Twitter’s co-founder, who owns 18,042,428 shares, would be receiving $978 million from the deal. Other top shareholders like The Vanguard Group, Morgan Stanley, and BlackRock would earn $4.4 billion, $3.6 billion, and $2.8 billion, respectively.
Also, top Twitter executives like CEO Parag Agrawal and CFO Ned Segal could earn as much as $42 million and $25 million, respectively. This is because a “change in control” clause in their contract allows them to be paid massively if they are terminated within 12 months of new ownership.
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South African-born Elon Musk has founded several companies, including X.com (which later became PayPal), SpaceX and Tesla Motors.