Elon Musk Threatens Twitter with Threat to Divest if His $43B Buyout is Refused

Tesla CEO and self-anointed “Technoking” has his robotic sights set on Twitter. After buying a 9.2 percent majority stake in Twitter last month, Musk decided not to join the board. After a few weeks of criticism and heat from the SEC, Elon Musk is yet again stepping up his Donald Trumps-esque strategy of staying relevant by any means necessary. This time, his stunt comes in the form of a $43 billion offer to buy Twitter outright. 

Elon Musk at Cyber Rodeo
Elon Musk | Tesla

Why is Elon Musk trying to buy Twitter? 

After days of back-and-forth fussing, Elon Musk “decided” not to join Twitter’s board. According to Musk, his reasoning for not joining the board and trying to buy the company is the same. 

Musk announced his offer to buy the company, you guessed it, on Twitter, but also in a Securities and Exchange Commission filing. As noted by The Drive, the entire filing can be found on the SEC’s website to read for yourself. But, this passage pretty well sums up Elon Musk’s explanation for attempting to take over another company and continue to grow his already bloated wealth: 

“…I believe free speech is a societal imperative for a functioning democracy. However, since making my investment, I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company,” Musk said in the filing. 

“As a result, I am offering to buy 100 percent of Twitter for $54.20 per share in cash, a 54 percent premium over the day before I began investing in Twitter, and a 38 percent premium over the day before my investment was publicly announced. My offer is my best and final offer, and if it is not accepted, I would need to reconsider my position as a shareholder.”

“Twitter has extraordinary potential. I will unlock it.”

Does Elon Musk own Twitter?

Elon Musk bought 9.2 percent of Twitter shares sometime in March, making him the majority shareholder. However, this does not mean he owns Twitter. He does not. Although, with this $2.9 billion purchase, he was offered a seat on Twitter’s board. According to The Drive, the weekend after disclosing this massive purchase, he spent the weekend tweeting sophomoric jokes, weed memes, and even bashing the platform. 

He then went on a campaign polling his “followers” to see if they wanted an “edit” button for Twitter, attempting to show that ideas like this are what he would bring to the table – as if the concept were novel. However, by Sunday, Twitter’s CEO, Parag Agrawal, announced that Musk would not be joining the Twitter board. The reasons for his refusal were not given at the time. 

Although this attempt to buy Twitter seems to have shown his hand, assuming this explanation is honest: “I am not playing the back-and-forth game,” says a voice transcript included in the filing. “I have moved straight to the end. It’s a high price, and your shareholders will love it. If the deal doesn’t work, given that I don’t have confidence in management, nor do I believe I can drive the necessary change in the public market, I would need to reconsider my position as a shareholder. This is not a threat; it’s simply not a good investment without the changes that need to be made. And those changes won’t happen without taking the company private.”

This is a not-so-veiled threat. Musk understands his influence on the market well and wields it as a weapon to coerce Twitter to sell. 

Despite Musk’s bleating about “freedom of speech,” it cannot go without saying that Twitter is a massive boon to Musk’s many holdings and his personal brand. Hell, Tesla doesn’t even have a dedicated PR team. Elon Musk’s personal Twitter page is one of the main ways customers and journalists learn what Tesla says it’s doing next. Twitter is Musk’s lifeline

Social media has become too valuable

Despite Elon Musk’s ethically gray attempt at a hostile takeover and an obviously threatening ultimatum, his move makes sense, given the value Twitter has added to Musk’s companies. 

The Los Angles Times reported earlier this week that research shows that Tesla’s Twitter following, including tens of thousands of bots, is largely responsible for the EV car company’s sharp rise in value over the past few years. 

“Over the 10-year study period, of about 1.4 million tweets from the top 400 accounts posting to the ‘cashtag’ $TSLA, 10% were produced by bots. Of 157,000 tweets posted to the hashtag #TSLA, 23% were from bots, the research showed.” 

So, if we don’t see this play as a very direct play to grow his own wealth and secure for himself a regulation-free place to market his many companies, we have lost the narrative. Despite the cluster, this will surely be; you can count on Musk Tweeting about all of it. 

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