Twitter has now been bought in full by Tesla CEO Elon Musk. Twitter ultimately accepted Musk’s offer to purchase 100 percent control of the company for $44 billion or $54.20 a share. This buyout possibly seems like it came in fast and it did. However, those familiar with the matter claim Musk remained calculated in his proposal.
To break down a quick timeline of events, Musk purchased 9.2 percent of Twitter on April 4. The Tesla CEO quickly became the largest shareholder of the company. Twitter’s board offered him a seat. However, Musk declined for reasons unknown but those privy pointed out that accepting would have limited Musk to a cap of owning a 15 percent stake. Musk also became outspoken on the changes he’d like to make within the company. On April 14, Musk publically announced his wishes to purchase Twitter for the aforementioned bid.
Surprisingly, this all occurred over the course of a short month. Musk had to move quickly and he did. As Yahoo Finance reports, Musk brought on Morgan Stanley as his adviser. He was able to convince a dozen banks to commit $25.5 billion in debt financing. He brought $21 billion in equity financing to the table himself in order to come up with a total of $46.5 billion. Musk and his advisers are said to have worked two consecutive weekends with sleepless nights on “Project X,” the codename of the bid.
Musk also spoke to many of the biggest active investors on Twitter to convince the board and shareholders to engage with the bid. Meetings with eight to 10 of Twitter’s investors to gauge shareholder views were made, sources said. Meetings began prior to Musk making his bid public knowledge.
Finally, Chairman Bret Taylor came to Musk following a valuation analysis and worked toward an outline of the deal, reportedly. Musk remained firm that his bid was the “best and final” price. Twitter’s advisers were unable to gain a higher price. However, they did secure a higher-than-average reverse breakup fee. Musk is also said to have completed the deal with a very open mind. The report concludes that Musk emailed bankers on a regular occasion to hear their insights on the deal’s termination fees, and weighed the pros and cons of the purchase.