On April 25th, Twitter’s board of directors accepted an offer from Elon Musk to not only buy, but acquire total control of the company. Musk’s offer of $54.20 per stock share equates to approximately 44 billion dollars. Given the visibility of Musk's wealth and status, this deal could easily be misconstrued as just another billionaire acquiring a company for frivolous reasons. Some have even implied that Musk bought Twitter out of complete boredom. In reality, this deal has been in the works for several months.

In January of 2022, Elon Musk began buying Twitter shares and allegedly accumulated over 5 percent stake in the company by the time March arrived. He chose not to disclose this information until the following month. According to an SEC (United States Securities and Exchange Commission) filing, investors are required to disclose stakes that surpass the 5% threshold within 10 days of closing a deal. Thus, on March 24th Musk disclosed his stake in Twitter, which had grown to about 9.2% in that ten-day grace period. As his stake in Twitter exponentially grew over the first months of 2022, Elon Musk was invited to join the board of directors but ultimately declined the offer. The most puzzling aspect of the Elon Musk and Twitter saga was Musk’s aptness to criticize the company via the Twitter platform. He repeatedly condemned Twitter’s constraints on free speech, which the public assumed to concern Donald Trump’s Twitter ban for inciting the January 6th insurrection. To the surprise of the whole world, Musk still made an offer to buy Twitter for his original price of 44 billion dollars with the intent of taking the company private. 

Since making his official offer on April 14th, countless interactions between Musk and Twitter’s board of directors have transpired, each more vindictive than the last. Twitter CEO Parag Agrawal has desperately been trying to hold his grasp on the company, although his efforts have fallen short due to the influence of Elon Musk. Even after releasing a poison pill, which is referred to as a shareholder's rights plan that threatens an unwelcome takeover bid to make itself unattractive to the bidder, the board was unable to overturn Musk’s bid. In a New York Times article, Musk’s ambitious goals for Twitter were revealed and surely turned some heads. He stated “Twitter needs to be transformed into a private company. Twitter has extraordinary potential. I will unlock it.” There would be countless consequences of Twitter going private if that is its immediate fate following the company’s buyout. The most obvious would be Twitter’s stock being taken off the New York Stock Exchange and forcing the forfeit of tens of millions of shares. There are also several risks involved with Twitter being operated as a private company given its large size and prevalence in the world. The other major social media companies, including Facebook, Instagram, and Linkedin, are operated publicly; therefore, there is no blueprint for this business model. While there are foreseeable benefits to a privately run Twitter, including the decrease in data mining, private social networks attract the offensive and inappropriate content that app moderators desperately try to diminish on their platforms. The simple truth is that users are less likely to be exposed for posting hostile content on a private network. Despite the company’s efforts and Musk’s condemned intentions with the Twitter platform, the two parties agreed on a final takeover deal of 44 billion dollars. 

In early May, the plot thickened when Musk announced that he was backpedaling on his initial offer to buy Twitter. His primary concern was with the spam and bot accounts that supposedly account for at least 20 percent of users on the platform. He expressed disdain for Twitter’s lack of concern with reducing spam because it gives a false perception of daily users. On May 21st, Musk expressed his suspicions about the company’s inability to explain why five percent of their daily users are fake spam accounts. These factors, coupled with the immense amount of pressure that has been put on Tesla’s stock since this whole deal went into the works, have given Elon Musk cold feet with the Twitter deal. There are some economic columnists who have inferred that Musk’s concern with the bot accounts is only a scapegoat to advocate for a lower price. 

In most recent days, the situation was left with Twitter’s board agreeing to the 44 billion dollar agreement as it is in the best interest of all shareholders. Whether or not Musk will actually go through with his promises, both finalizing the deal and also taking Twitter private, is still unknown. Given the recent events and the current state of the deal, it could be inferred that Elon Musk may have come to terms with the fact that he made a mistake by engaging in Twitter shares. It is evident that this fiasco has compromised Tesla in at least some regard. The ironic aspect of Musk’s situation is that his dilemma is very common for most business owners. Many strive to extend their influence across different markets by adopting more versatile business practices. There is a great amount of risk associated with this practice, however, and most people fail in the process. The only real difference is that Elon Musk’s failures are amplified to the whole world due to his status. The whole world will be watching as the loose ends of this deal are wrapped up in the coming weeks. Twitter is undoubtedly a beloved social media network and while its future is unknown, there will always be users to express their thoughts on the platform. 

Works Cited

Duffy, Clare. “Elon Musk to Buy Twitter in $44 Billion Deal | CNN Business.” CNN, Cable News Network, 26 Apr. 2022, https://www.cnn.com/2022/04/25/tech/elon-musk-twitter-sale-agreement/index.html. 

“The Musk-Twitter Saga.” The Economic Times, 18 May 2022, https://economictimes.indiatimes.com/tech/technology/timeline-how-elon-musks-twitter-takeover-unfolded/articleshow/91100011.cms. 

“Elon Musk Wants to Slash $44 Billion Twitter Deal by 25%.” Yahoo! Finance, Yahoo!, https://finance.yahoo.com/news/elon-musk-wants-slash-44-152422909.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAKU8qhRVS8pigtPNwpRrkkZ_V4urz_zZGa8MRltFnQQCFnHAnlrFYv-PGbB-_fgqDECgqWIKQ7mZywQ0lrbZkz-19PoDG3DbowiU5Z_er8U6CKzU6n8qLC7IdpldSWcj6RU4OZ2hvpvSMJysdJcjFnkmIKvwhSi0biULmPhX-3w3.