It sure looks like Elon Musk’s $44 billion Twitter takeover is actually happening.
On Tuesday, representatives of the billionaire notified Twitter through a letter that he intends to move forward with the tumultuous deal, confirming earlier reports that things were back on track.
“We write to notify you that the Musk Parties intend to proceed to closing of the transaction contemplated by the April 25, 2022 Merger Agreement, on the terms and subject to the conditions set forth therein,” reads the notice, which was filed with the Securities and Exchange Commission.
Musk and Twitter were headed to court over the deal, with the Tesla and SpaceX chief executive claiming that Twitter had misled him over the number of bots that existed on the social network. Without providing evidence of his claims, Musk has alleged that as much as 20% of Twitter’s user base consisted of “fake/spam accounts.” Twitter has long maintained that less than 5% of its “monetizable daily active users” — a subset of its user base provided as a metric for advertisers — are bots. However, it now seems that Musk no longer intends to press the issue.
“We received the letter from the Musk parties which they have filed with the SEC,” Twitter told TechCrunch in a statement, which it also shared on its investor relations account. “The intention of the Company is to close the transaction at $54.20 per share,” the company added. Musk’s notice sent Twitter’s stock price rocketing more than 12%, above $47 per share.
Per the letter, Musk intends to move forward with the deal “provided that the Delaware Chancery Court enter an immediate stay of the action, Twitter vs. Musk, et al. and adjourn the trial and all other proceedings.” In other words, Musk is down to move forward under the condition that the lawsuit does not proceed. However, given Musk’s chaotic nature, it’s possible that another wrench could be thrown into the works.
While it’s not clear what inspired Musk’s change of heart, there have been a number of recent twists and turns in the days leading up to the trial, which was set to begin on October 17. The court recently published a trove of Musk’s texts about the deal, uncovered through the discovery process, and the messages clearly show him getting cold feet in light of the war in Ukraine and a looming worsening global economic picture.
Another twist came last night, when Delaware Chancery Court Judge Kathaleen McCormick approved Twitter’s request to review texts from Musk’s inner circle related to a mysterious anonymous email that Musk’s lawyer Alex Spiro received on May 6. In the email, which was sent through ProtonMail, the sender identified themselves only as a former Twitter executive and asked Musk’s team to follow up on a different platform.
While the tipster was anonymous, it certainly seems possible that the email was sent by former Twitter head of security Peiter “Mudge” Zatko, who denied reaching out to Musk prior to going public with his whistleblower complaint in August. Musk’s team subpoenaed Zatko at the end of August, seeking testimony and documents that could make the case that revelations around security lapses at the company were concerns sufficient to kill the deal.
Late Tuesday, Musk tweeted that buying Twitter would provide an “accelerant” to a different project altogether, “X, the everything app.” Musk’s mysterious software grand plan is probably news to everyone on either side of the deal, though he did previously say he’d launch a social media site called X if the Twitter plan fell through. He does own X.com again, and a holding company by the same name, but an app called X seems more likely to be vaporware — or just a joke — than anything that will actually materialize.