Elon Musk’s attempt to buy Twitter is not dead in the water. In fact, the social networking service’s board is close to accepting Musk’s $43 billion offer to buy the company and take it private, according to multiple reports on Monday.
Financing of Musk’s bid of $54.20 a share, the sources said, was “a turning point” that enabled the 11 board members to “seriously consider his offer.”
Individuals close to the company told the Times that the board was negotiating with Musk “into the early hours of Monday” to discuss “other contours around a potential deal,” which included a timeline to close a deal and fees that would be paid “if an agreement was signed and then fell apart.”
The Tesla and SpaceX founder announced Thursday that he had lined up $46.5 billion in funds to buy Twitter, and was considering a tender offer to shareholders if the board rejected his offer. That figure is also $3.5 billion more than the $43 billion of his original publicized offer, though it was not immediately clear whether that represented a higher price-point offer or just buys Musk additional negotiating wiggle room.
Those details were released in a Thursday filing with the SEC, showing the $46.5 billion was backed by debt commitment letters from Morgan Stanley, Bank of America, Barclays and several banks agreeing to lend Musk an aggregate of $25.5 billion, according to the filing. Musk will cover the rest of the $21 billion via equity financing.
A Twitter spokesman declined to comment.
Twitter’s board a little over a week ago approved plans to employ a poison pill defense to fight Musk’s takeover of the company. Any shareholder could choose to take the offer; if a majority (plus Musk’s outstanding shares, just over 9%) were to agree, he could take control — though Twitter’s recently enacted “poison pill” conditions could upend that process.
“The Rights Plan is intended to enable all shareholders to realize the full value of their investment in Twitter. The Rights Plan will reduce the likelihood that any entity, person or group gains control of Twitter through open market accumulation without paying all shareholders an appropriate control premium or without providing the Board sufficient time to make informed judgments and take actions that are in the best interests of shareholders,” the company said in its April 15 statement.
