Twitter's board has unanimously agreed to sell the platform in its entirety to Elon Musk for a deal valued at $44 billion, the company announced on Monday.
Stockholders will receive $54.20 per share as part of the deal, a 38 per cent premium over the social platform's closing stock price on April 1. The deal is expected to be completed by the end of the year.
“Free speech is the bedrock of a functioning democracy and Twitter is the digital town square where matters vital to the future of humanity are debated,” Mr Musk said in the statement.
“I also want to make Twitter better than ever by enhancing the product with new features, making the algorithms open source to increase trust, defeating the spam bots, and authenticating all humans. Twitter has tremendous potential — I look forward to working with the company and the community of users to unlock it.”
Mr Musk tweeted a screenshot of his statement with emojis of rockets, shooting stars and hearts. “Yesss!!!” he said.
Twitter shares on Monday were trading up more than 5 per cent at about $52.00.
“Twitter has a purpose and relevance that impacts the entire world. Deeply proud of our teams and inspired by the work that has never been more important,” Twitter's chief executive Parag Agrawal said in the statement.
The company had an all-hands video call on Monday to discuss the deal, during which news agencies reported Mr Agrawal said there would be no job cuts and that a hiring freeze is now in place.
Mr Musk will soon join the company's staff for a question-and-answer session, he added.
"Once the deal closes, we don't know which direction the platform will go," Mr Agrawal was quoted as saying by Bloomberg and Reuters, citing audio from the meeting and people who attended.
Last week, Mr Musk, the billionaire chief executive and co-founder of Tesla, the world’s biggest electric vehicle company, said he had a funding commitment of $46.5bn to finance his bid to buy Twitter and was considering initiating a tender offer for its shares.
Mr Musk said on Thursday in a regulatory filing that he personally committed to provide $33.5bn for the deal. This will include $21bn of equity and $12.5bn from margin loans.
Twitter’s board is believed to have met on Sunday to discuss Mr Musk’s financing plan for his proposal.
This April, Mr Musk offered to buy 100 per cent of Twitter but the company's board moved to shield itself from the takeover bid by adopting a limited-duration shareholder rights plan, which would enable its shareholders to buy additional stock under a “poison pill” strategy.
Mr Musk's offer came after frequent complaints about claims of content censorship and lack of free speech on the site.
“Given that Twitter serves as the de facto public town square, failing to adhere to free speech principles fundamentally undermines democracy. What should be done?” Mr Musk said on Twitter last month.
In response to his poll, 70.4 per cent of users said Twitter does not stick to free speech principles, while 29.6 per cent supported the platform.
He tweeted earlier on Monday as Twitter users claimed they'd leave the platform: “I hope that even my worst critics remain on Twitter, because that is what free speech means.”
In response to a reporter's question on the deal, White House Press Secretary Jen Psaki said: “President [Joe Biden] has long talked about his concerns about the power of social media platforms, including Twitter and others to spread misinformation, disinformation, the need for these platforms to be held accountable.”
Mr Musk’s deal has met resistance, particularly from Twitter’s shareholders.
Saudi billionaire Prince Alwaleed bin Talal, who owns a stake in Twitter through his Kingdom Holding Company, rejected Mr Musk’s offer last week, saying it did not “come close to the intrinsic value of Twitter given its growth prospects”.
This month, buyout firm Thoma Bravo contacted Twitter to express an interest in putting together an acquisition offer that would rival Mr Musk’s bid.
The firm with more than $103bn in assets under management as of the end of December informed Twitter that it was exploring such a move, Reuters reported, citing sources.
However, Reuters also reported that Twitter didn't receive competing acquisition offers from other companies or firms.
"The pressure was on for Twitter to make a decision on Musk’s deal before Thursday’s earnings announcement as many were expecting disappointing results," Edward Moya, senior market analyst for the Americas at New York-based Oanda, said.
Twitter is expected to announce its first quarter earnings for the year on Thursday.
“We could perhaps see Twitter miss numbers later this week … that wouldn’t be a huge surprise given their well-documented struggles to monetise the platform,” Neil Campling, co-head of Mirabaud Securities' Global Thematic Group, told The National.
The company’s net loss for the 2021 financial year narrowed to $221.4 million compared to the $1.14bn loss it posted in 2020.
That was on the back of improved revenue, which rose 37 per cent on an annual basis to more than $5bn last year.
Elon Musk's career - in pictures
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Mr Musk unveils a new all-wheel-drive version of the Model S car in Hawthorne, California, in 2014. Reuters -
Tesla and SpaceX founder Elon Musk. Getty Images -
Mr Musk with music producer Quincy Jones. AFP -
The wealthiest person in the world with a worth of $274.3 billion, Mr Musk was named 'Person of the Year' by 'Time' magazine in 2021. Getty Images -
Focus on Mr Musk's taxes grew last year as Tesla achieved a rarefied $1 trillion in market value. Reuters -
The billionaire has hit back, saying he does not draw a salary from either SpaceX or Tesla, and pays an effective tax rate of 53 per cent on stock options he exercises. AFP -
Then US president Barack Obama speaks to Mr Musk on a tour of Cape Canaveral Air Force Station in Cape Canaveral, Florida, in 2010. Reuters -
Mr Musk during a television interview after Tesla's initial public offering at the Nasdaq market in New York, in 2010. Reuters -
With former wife Talulah Riley at the 2011 Orange British Academy Film Awards in London. Getty Images -
With Japan's former prime minister Shinzo Abe after a test drive of the Tesla Model S P85D in Palo Alto, California, in 2015. Reuters -
Mr Musk during the 67th International Astronautics Congress in Guadalajara, Mexico, in 2016. EPA -
From left: SpaceX chief executive Elon Musk, Corning chief executive Wendell Weeks, then US president Donald Trump and Johnson & Johnson chief executive Alex Gorsky during a meeting at the White House. AFP -
Mr Musk and former wife Grimes at The Metropolitan Museum of Art in New York City, in 2018. AFP -
Mr Musk leaves a court in New York City, in 2019, after a hearing in a lawsuit brought against him by the US Securities and Exchange Commission. Getty Images -
A prototype of SpaceX's Starship spacecraft is seen before Mr Musk gives an update on the company's Mars rocket Starship in Boca Chica, Texas, in 2019. Reuters -
Mr Musk at the construction site of the Tesla Gigafactory in Gruenheide, near Berlin, Germany, last year. EPA -
Dancing onstage during a delivery event for Tesla's China-made Model 3 cars in Shanghai. Reuters -
Mikey Day as a lawyer, Cecily Strong as a judge, and host Elon Musk as Wario during the "Wario" sketch on NBC's 'Saturday Night Live', in May. Getty Images -
Mr Musk with Armin Laschet, CDU party federal chairman and prime minister of Germany's North Rhine-Westphalia, talk during a tour of the plant of the future foundry of the Tesla Gigafactory in Grünheide, near Berlin, Germany. Getty Images
