News Elon Musk The Completes Deal Twitter
The social media platform was successfully acquired by the richest man in the world, ushering Twitter into a new age.
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| Review news Elon Musk Completes 44$ Billion Twitter Acquisition Deal |
From San Francisco, Kate Conger covers technology, and from New York, Lauren Hirsch covers mergers and acquisitions.
Elon Musk now has control of Twitter after months of ambiguity, legal issues, verbal tiffs, and a narrow escape from a full-blown trial.
According to three people with knowledge of the issue, Mr. Musk finalised his $44 billion purchase of the social media platform on Thursday night. Additionally, he started purging staff; on Thursday, at least four senior Twitter employees, including the CEO and CFO, were let go. On Wednesday, Mr. Musk had visited the Twitter office in San Francisco and had meetings with engineers and ad executives.
The conclusion of the agreement, which came after months of drama and legal challenges as Mr. Musk changed his mind about purchasing the business, casts doubt on Twitter's future. The self-described and that he wants to make it a more open space for all forms of debate.
Mr. Musk's candid style of communication on Twitter could worsen long-standing problems with harmful information and disinformation, impacting political discussions all across the world.
Early tests will occur in the coming days, when Brazil elects a new president and American voters cast ballots in the midterm elections on November 8. Prior to Elon Musk becoming its owner, Twitter declared that it would forbid false statements regarding the voting process and the results of elections.
David Kaye, a law professor at the University of California, Irvine who has worked with the United Nations on issues of free speech, said of Mr. Musk's ownership of Twitter: "There could be real-world implications to his leadership." World leaders could push to see how far they can go if they believe they have this space and that it is unmoderated.
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| On Wednesday, Mr. Musk paid a visit to the San Francisco headquarters of Twitter. He is scheduled to speak to the staff on today Friday. Credit... for The New York Times, Jason Henry |
Republicans who claimed that Twitter restricted conservative perspectives have praised the deal. According to researchers, Twitter's policies have proved crucial in preventing online hate speech and misinformation. Some business owners have expressed concern about having their products associated with divisive comments.
Colin Crowell, who served as Twitter's previous president of global public policy until leaving the company in 2019, described the move as a "back-to-the-future" return to content guidelines from around 2010. However, he added, "it ignores the lived experience of the last decade." People gradually come to the realisation that the Wild West needs a sheriff, both to ensure the safety of the populace and to improve the chances for trade.
Other significant changes at Twitter, like as new leadership, employment layoffs, and the search for new revenue streams, have also been pledged by Mr. Musk. Twitter, a San Francisco-based company with over 7,500 employees, has struggled to continuously grow its advertising-based business and draw in new users. The fact that the top business executives were fired on Thursday was a signal that Mr. Musk intended to act quickly.
The 51-year-old Mr. Musk will revamp Twitter without needing to reveal its performance on a regular basis. He can make modifications to the service without having to answer to shareholders on a regular basis by taking the company private.
A request for a statement was not immediately answered by Mr. Musk, who also owns the electric vehicle manufacturer Tesla and the rocket firm SpaceX.
For the board of Twitter, the agreement's conclusion was a success. When Mr. Musk agreed to purchase Twitter for $54.20 per share in April, the company received criticism for accepting a too-low price. The board then attempted to persuade Mr. Musk to uphold the deal as the global economy worsened in the months that followed and Twitter's stock fell, making the purchase price appear to be a benefit for shareholders.
An inquiry for comment was not immediately answered by a Twitter spokesperson.
Two people with knowledge of the matter said that the chief executive, Parag Agrawal, chief financial officer, senior legal and policy executive, Vijaya Gadde, and general counsel, Sean Edgett, were among the Twitter officials let go on Thursday. At least one of the fired executives, according to their claims, was led out of Twitter's headquarters.
Mr. Musk, one of Twitter's most active users with more than 109 million followers, began buying company stock this year. In April, he reached a deal to purchase the company for $44 billion, vowing to update Twitter's policies on content moderation, eliminate spam, provide new services, and be more transparent about the algorithms that are used to promote content.
In an April statement, he stated, "Twitter has immense potential; I look forward to working with the company and the community of users to unlock it.
However, after just a few weeks, he began to have second thoughts about the deal. Musk accused Twitter of undercounting the number of spam accounts utilising its platform and criticised the staff members in charge of selecting material. Musk responded by tweeting a faeces symbol when Twitter CEO Parag Agrawal tried to contradict his claims.
By July, Mr. Musk had already decided that he did not want to run Twitter anymore. He made the justification that he had been deceived about the amount of spam the site received. He said that he would cancel the acquisition.
Twitter sued Mr. Musk to force him to uphold the agreement. According to the company, Mr. Musk was attempting to break the contract because the recession had decreased his personal fortune. Mr. Musk agreed to personally contribute around $33 billion of the $44 billion transaction.
The complaint was finally considered by Delaware Chancery Court, which deals with many corporate disputes. The court set a five-day trial to hear the case for the middle of October.
When Mr. Musk was confronted with days of testimony and an uncertain outcome, he had a change of heart. He tried to haggle for a cheaper contract fee. Those discussions were fruitless. This month, Mr. Musk said he would proceed with the purchase at the original price if Twitter withdrew its legal action against him.
The judge ruling over Twitter's case has allowed Mr. Musk three weeks to complete the transaction.
Musk has ambitious plans for the social media site, promising to make Twitter into a "everything app" called X. In presentations to investors about the acquisition, he projected that by 2028, Twitter will have 931 million users and produce $26.4 billion in income annually. The company recorded $5.08 billion in sales the year before with more than 200 million users.
Mr. Musk said that in order to keep Twitter's costs in check, cuts may be necessary. There is a chance that many employees will lose their employment. Twitter recently made an effort to reassure its employees by recommending that they ignore rumours of upcoming layoffs.
Twitter's performance will be essential as Mr. Musk balances funding Twitter's future with paying off the interest on the $12.5 billion in loans he took out to finance the deal. Analysts have questioned whether Twitter can afford to make those payments given its inconsistent profits.
Since Mr. Musk unveiled his idea in April, the market for those loans has plummeted precipitously, which will hurt the investment banks that put them together.
After Mr. Musk criticised the use of advertising on Twitter and suggested that the company should find an other source of income, advertisers may be leery of doing business with him. Other advertisers have decided to spend money on social media platforms like Facebook and TikTok while some have expressed scepticism about their brands being associated with dangerous content that Mr. Musk has stated should be permitted on Twitter.
He claimed that it is obvious that Twitter cannot turn into a "free-for-all hellscape" where anything may be expressed without consequence. Twitter aspires to be the most trusted advertising platform in the world.
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