Elon Musk officially acquired Twitter today for $44 billion then promptly fired several executives as soon as he stepped in the door.
In one of his first decisions at the helm of the social media giant, Elon Musk, the world’s richest man, fired three top executives including CEO Parag Agrawal, multiple United States-based media outlets reported on Thursday, citing people familiar with the matter.
Twitter first accepted Elon Musk’s original offer to buy Twitter back in April, but the Tesla CEO threatened to back out of the deal just weeks later, accusing the platform of misleading or lying to investors about its number of daily active users and saying that the deal “cannot move forward” until Twitter proved that less than 5% of users are bots or spam accounts.
Elon Musk formally sought to cancel the deal in July, writing in a letter to the SEC, “Mr. Musk is terminating the Merger Agreement because Twitter appears to have made false and misleading representations upon which Mr. Musk relied when entering into the Merger Agreement.”
Four days later, Twitter responded with a lawsuit, writing, “ Elon Musk believes that he unlike every other party subject to Delaware contract law is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away.”
The Tesla/SpaceX boss explained his reasons for the $44 billion purchase Thursday, saying, “There is currently great danger that social media will splinter into far right wing and far left-wing echo chambers that generate more hate and divide in our society.”
He continues, “In the relentless pursuit of clicks, much of traditional media has fueled and catered to those polarized extremes, as they believe that is what brings in the money, but, in doing so, the opportunity for dialogue is lost.”
He says, “That is why I bought Twitter. I didn’t do it because it would be easy. I didn’t do it to make more money. I did it to try to help humanity, whom I love. And I do so with humility, recognizing that failure in pursuing this goal, despite our best efforts, is a very real possibility.”
One thing seems certain: The Twitter we’ve all come to know is about to change substantially. Elon Musk pictures himself as an advocate of free speech and has been openly critical of the company’s monitoring of violent or hateful content.
And expect some high-profile permanent bans to be reversed, with former President Donald Trump Donald Trump likely to be welcomed back should he want to return to the platform.
It has been six months of ongoing drama since Elon Musk made his unsolicited $54.20 per share bid public. Initially, Twitter resisted the deal by adopting a so-called “poison bill.”The company later sued the billionaire after he declared plans to abandon it since he was concerned about spam accounts on the platform.
Elon Musk has acknowledged he overpaid for Twitter.”
The $44 billion price tag for Twitter will go down as one of the most overpaid tech acquisitions in the history of M&A deals on the Street in our opinion,” Wed bush Securities analyst Daniel Ives wrote in a research note Thursday. He put the value of Twitter at closer to $25 billion.
“Although myself and other investors are overpaying for Twitter right now,” Elon Musk recently said, “the long-term potential for Twitter is an order of magnitude higher than its current value.”
Twitter’s largely liberal audience has recoiled at some of Elon Musk’s statements on free speech. There has been speculation that former President Donald Trump would be invited back (Trump said he wouldn’t), but others banned from the service may be resurrected.
Such practices as “shadow banning” and limiting the audience for certain commenters may also change under the new management.
