Case studies. Before the Twitter Board, there is a real one now. Here we go: Elon Musk has made an offer to own 100% of Twitter, at $54.20 per share for the units currently outside his control. The little blue bird traded last at $45.85. But that is not the end of the story. Mr Musk had noted that his bid is FINAL, and that if the Board disagrees, he will dump the more than 9% he currently owns. Of course, if that happens, the price will crash. Here is my question: if you are on the Twitter Board, what will you do? I mean, would you vote YES for Musk or will you prefer to face the company losing more than 50% of its value in days? Share your perspectives below.
Elon Musk Letter
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.
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However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.
As a result, I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced. My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder.
Twitter has extraordinary potential. I will unlock it.
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The man Musk is an enigma, no questions.
I don’t think the choice is really a hard one, it’s a cash out time for Twitter stockholders, the platform is never big on revenue or very profitable, but it remains the closest thing to a village square for free speech, which the current CEO is obviously unfit to run. You cannot control and shape narratives as a super billionaire without owning a media platform, and Musk owns none yet, so it’s a necessity, before they start censoring his opinions, he’s not dumb.
The board doesn’t need to second guess, Musk has already boxed it to a corner, if they reject Musk’s offer, Twitter will have its own ‘Yahoo Moment’ in the near future, and there will be enough blames to go round.
Musk never planned to purchase 9.2%, it was a bait to upend market value, now that he has confirmed that his actions move prices, if he pulls the plug, Twitter market value will tank.
It’s a game of wits, and Musk is smarter than the folks jostling to thwart him; accept the offer or you live miserably ever after.