Tesla chief Elon Musk had offered to buy Twitter.
Highlights
- Shares of Twitter jumped 11% before the market opened
- Twitter has the potential to be the platform for free speech around the globe, said Elon Musk
- The buyout offer from Musk is just the latest development in his relationship with Twitter.
Tesla chief Elon Musk has offered to buy Twitter for &54.20 a share. He added that the social media company must be transformed privately. His offer came days after the Tesla CEO said he would no longer be joining the social media company's board of directors.
Twitter Inc. said in a regulatory filing on Thursday that Musk, who currently owns slightly more than 9% of its stock and is the company's biggest shareholder, provided a letter to the company on Wednesday that contained a proposal to buy the remaining shares of Twitter that he doesn't already own.
“I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy,” Musk says in the filing.
“However, since making my investment I now realise the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.”
The buyout offer from Musk is just the latest development in his relationship with Twitter. The billionaire revealed in regulatory filings over recent weeks that he'd been buying shares in almost daily batches starting Jan. 31. Only Vanguard Group's suite of mutual funds and ETFs controls more Twitter shares.
At that point, Twitter quickly gave Musk a seat on its board on the condition that he not own more than 14.9% of the company's outstanding stock, according to a filing. But Musk backed out of the deal.
Musk's 81 million Twitter followers make him one of the most popular figures on the platform, rivalling pop stars like Ariana Grande and Lady Gaga. But his prolific tweeting has sometimes gotten him into trouble with the SEC and others.
Musk and Tesla in 2018 agreed to pay $40 million in civil fines and for Musk to have his tweets approved by a corporate lawyer after he tweeted about having the money to take Tesla private at $420 per share.
That didn't happen but the tweet caused Tesla's stock price to jump. Musk's latest trouble with the SEC could be his delay in notifying regulators of his growing stake in Twitter.
Musk has described himself as a “free speech absolutist” and has said he doesn't think Twitter is living up to free speech principles — an opinion shared by followers of Donald Trump and a number of other right-wing political figures who've had their accounts suspended for violating Twitter content rules.
Shares of Twitter jumped 11% before the market opened.
(With inputs from AP)
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