Elon Musk swoops in for control of Twitter
Future. After a rollercoaster of a week, Musk has made his intentions with Twitter clear: he wants to own it. Musk is attempting a hostile takeover of the company for the tune of $43 billion. The Tesla and SpaceX CEO sees Twitter as the potential paragon of democracy and wants to make sure that the company’s policies and features reflect that. The only problem is that Twitter’s community may scoff at the idea of the richest person in the world controlling one of the most public platforms for free speech.
Bird of prey
Musk — one of the most popular people on Twitter with 81 million followers — is making his play to rule the roost.
- He’s offering $54.20/share for the platform (which would value the company at $43 billion) in a hostile takeover bid.
- While Musk may be the richest person on Earth, he’s not planning to make the purchase with all of his own cash, meaning that other investors may be invited to join him… or he’ll just raise a lot of debt financing.
Although Twitter said that it would seriously review the offer, The Information reports that the company’s board plans to fight the takeover — potentially putting the company up for auction or even taking a “poison pill” to reduce Musk’s stake.
Musk told board chair, Brett Taylor, that he would sell his shares if he wasn’t successful in the takeover… but even Musk isn’t confident that he’ll be able to pull it off and that he has a “Plan B” if the deal doesn’t pan out.
No nest egg
So here’s the $43 billion question: what the heck does Musk — you know, the guy who already has his hands full running SpaceX and Tesla — want with Twitter?
- He wants to take it private, kick out management, and transform its business model, so it relies more on subscriptions than ads (which is roughly 90% of its revenue right now).
- He views it as the “de facto town square,” so he wants to open-source its algorithms to “build trust” and ensure that there’s no internal manipulation.
- He’s also concerned with its overly strict — in his view — moderation standards and speech restrictions, believing people should be able to say whatever they want “within the bounds of the law.”
- He also doesn’t believe that anyone should ever be permanently banned.
Are any of these choices best for Twitter’s bottom line and its aggressive growth plans? It doesn’t matter. Musk said that “having a public platform that is maximally trusted and broadly inclusive is extremely important to the future of civilization. I don’t care about the economics at all. […] Twitter has extraordinary potential. I will unlock it.”
At least one person is not down for Musk’s plan to control Twitter: Jack Sweeney, who is behind the account that tracks the whereabouts of Elon Musk’s private jet. His response was a simple, “Oh no.”