Elon Musk-Twitter Deal Gets Shocking Twist: Tesla CEO Will Push Through Sale on One Condition
Elon Musk is eager to proceed with the Twitter sale at the initial price of $44 billion. This is according to a proposal letter issued to the Securities and Exchange Commission by Tesla CEO's lawyer on Tuesday.
"We received the letter from the Musk parties, which they have filed with the SEC. The intention of the company is to close the transaction at $54.20 per share," Twitter stated.
According to NBC News, this plan could end the long legal dispute between the two sides, which will be tried in Delaware next month.
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Elon Musk Buys Twitter to Avoid Trial
If the Elon Musk-Twitter deal goes through, it will be run by a billionaire who has spent months openly criticizing the company's management, questioning its worth, and changing his mind.
This also means that his disputed claims will not likely be looked at in court.
Musk has been attempting for months to get out of his April contract to acquire Twitter. Shortly after the acquisition was revealed, the billionaire started expressing indications of buyer's remorse, claiming that Twitter had lied to him about its user base's size and the number of automated accounts known as bots, Bloomberg reported.
Musk formally cancelled the agreement in July, and Twitter filed suit against him in Delaware Chancery Court, forcing him to complete the acquisition.
On October 17, the trial was scheduled to begin. On Tuesday, the judge in this Delaware case requested that both sides come back to her with their proposals on how to move forward with the case.
A source said Twitter could try to get the lawsuit dismissed, or she can keep authority over it until the deal is finalized.
According to Musk's attorneys' letter, he and his supporters "intend to proceed to the closing of the transaction contemplated by April 25, 2022 merger agreement, on the terms and subject to the conditions set forth therein."
Additionally, the proposal is subject to him securing the necessary debt financing, and the court gives "an immediate stay of the action."
Banks are having a difficult time selling debt. With yields reaching multiyear highs, banks led by Morgan Stanley might face hundreds of millions of dollars in losses if they try to sell the unsecured component to investors.
Elon Musk-Twitter Sale Caused the Twitter Stock to Jump 22%
Shares of Twitter TWTR, +22.24%, increased by 22.2% on Tuesday to $52.
Market Watch noted that after Bloomberg News announced the move at noon Eastern time, trading was halted for several hours, indicating that the legal saga between the two sides may have ended.
Right behind the 27.1% rise that occurred when Musk first disclosed that he owned a share of Twitter in April, this is the second-best daily percentage gain for Twitter stock.
With a 3.06% gain on Tuesday, Twitter was the best-performing stock in the S&P 500 index SPX. It has now increased by 20.3% for the year.
Meanwhile, a court filing from Tuesday says that Musk was supposed to answer questions about the Elon Musk-Twitter deal on Oct. 6-7 in Austin, Texas. On Monday, Chief Executive Officer of Twitter Parag Agrawal was set to appear for his deposition.
This article is owned by Latin Post.
Written by: Bert Hoover
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