JAKARTA - Elon Musk has finally reached an agreement to buy Twitter for 44 billion US dollars (Rp 636.6 trillion) in cash on Monday or Tuesday morning, April 26 Indonesian time. The deal will shift control of the social media platform home to millions of users and global leaders into the hands of the world's richest man.
This is a landmark moment for a 16-year-old company that is considered one of the most influential free speech squares in the world and is now facing a series of challenges.
Musk has previously criticized Twitter's moderation and called himself a free speech absolutist, saying Twitter's algorithm for prioritizing tweets should be published. He also criticized Twitter for giving too much power to the service to companies that advertise.
Political conservatives hope that under the Musk regime, Twitter will moderate less and reinstate individuals banned on the platform, including former President Donald Trump. Musk himself has also described user-friendly tweaks to the service, such as an edit button and defeating "spam bots" that send large amounts of unwanted tweets.
️ Yesss!!! ️💫🚀 pic.twitter.com/0T9HzUHuh6
— Elon Musk (@elonmusk) April 25, 2022Discussions over the deal, which last week looked uncertain, accelerated over the weekend after Musk wooed Twitter shareholders with financing details of his bid.
Under this pressure, Twitter began negotiating with Musk to buy the company at the proposed $54.20 per share price.
"Freedom of speech is the cornerstone of democracy, and Twitter is the digital city square where what matters to humanity's future is debated," Musk said in a statement.
In a tweet, Elon Musk also stated that even the worst criticism will remain on Twitter, because free speech guarantees it.
I hope that even my worst critics remain on Twitter, because that is what free speech means
— Elon Musk (@elonmusk) April 25, 2022Twitter shares rose 5.7% on Monday to close at 51.70 dollars. The deal represented nearly a 40% premium to the closing price the day before Musk revealed he had bought more than 9% of the stake. Even so, the bid was below the $70 range when Twitter stock traded last year.
"I think if the company is given enough time to change, we'll make a lot more than Musk is offering right now," said Jonathan Boyar, managing director of the Boyar Value Group, which holds a stake in Twitter.
"This transaction reinforces our belief that if the public market doesn't value the company properly, eventually the acquirer will," added Boyar.
Musk's move continues a tradition of billionaires buying control of influential media platforms that included Rupert Murdoch's takeover of the New York Post in 1976 and the Wall Street Journal in 2007 and Jeff Bezos' acquisition of the Washington Post in 2013.
Twitter said Musk secured $25.5 billion in debt and margin loan financing and made $21 billion in equity commitments.
Musk, who is worth $268 billion according to Forbes, says he doesn't really care about Twitter's economy.
“Having a public platform that is maximally trustworthy and broadly inclusive is critical to the future of civilization. I don't care about the economy at all," he said in recent public talks.
Musk is known as a super busy person. He is the chief executive of electric car maker Tesla and aerospace company SpaceX. It's unclear how much time he will devote to Twitter going forward.
"This is great news for Twitter shareholders because it doesn't look like the company is going to fix it any time soon. Tesla shareholders aren't happy that Musk has to distract more from winning the EV (electric vehicle) competition," said Edward Moya, analyst at currency broker OANDA. .
However, Musk's Twitter account, which has a following of 80 million people, was seen as an important, free public relations tool for Tesla over the years.
The Twitter transaction itself was approved by the board and is now subject to shareholder voting. No regulatory hurdles are expected to arise with this acquisition.
Daniel Ives, an analyst at Wedbush, said the company's board of directors put up a wall to block Musk from detailing his financing package and no other bidder or white knight has emerged to rival Musk.
Former US President Donald Trump, who is still banned from Twitter, and is building a similar social media called Truth Social, once said he would not return to Twitter again. But if Musk reopens his account, of course it will be interesting.
The White House on Monday, April 25, declined to comment on the Musk deal. But they say President Joe Biden has long been concerned about the power of the social media platform.
"Our concerns are not new," said White House spokeswoman Jen Psaki, adding that the platform needed to be held accountable. "The president has long spoken of his concerns about the power of social media platforms, including Twitter and others, to spread misinformation."
This hints that many rules will be imposed for Twitter, to be able to realize Musk's determination to make Twitter a true square of free speech.
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