Twitter under shareholder pressure to seek deal with Elon Musk, sources say
- Musk has called his US$43 billion bid for the social media platform his best and final offer, people familiar with the matter said on Sunday
- Twitter’s board is expected to find that Musk’s all-cash US$54.20 per share offer is too low by the time it reports quarterly earnings on Thursday
Twitter Inc is coming under increasing pressure from its shareholders to negotiate with Elon Musk even though the world’s richest person has called his US$43 billion bid for the social media platform his best and final offer, people familiar with the matter said on Sunday.
While the views of Twitter shareholders vary over what a fair price for a deal would be, many reached out to the company after Musk outlined his acquisition financing plan on Thursday and urged it not to let the opportunity for a deal slip away, the sources said, speaking on condition of anonymity.
Twitter’s board is expected to find that Musk’s all-cash US$54.20 per share offer for the company is too low by the time it reports quarterly earnings on Thursday. Nonetheless, some shareholders who agree with that stance still want Twitter to seek a better offer from Musk, whose net worth is pegged by Forbes at US$270 billion, the sources told Reuters.
One option available to Twitter’s board is to open its books to Musk to try to coax him to sweeten his bid. Another would be to solicit offers from other potential bidders. While it is not yet clear which path Twitter will take, it is increasingly likely that its board will attempt to solicit a better offer from Musk even as it rebuffs the current one, the sources said.
“I wouldn’t be surprised to wake up next week and see Musk raise what he called his best and final offer to possibly US$64.20 per share,” one of the fund managers who is invested in Twitter said on condition of anonymity to discuss private conversations with the company.
“He could also drop the whole thing entirely. Anything is possible,” the fund manager said about Musk’s offer.
Twitter shares closed at US$48.93 on Friday, a significant discount to Musk’s offer that reflects the uncertainty over his bid’s fate.
Twitter adopted a poison pill after Musk made his offer to prevent him from raising his more than 9 per cent stake in the company above 15 per cent without negotiating a deal with its board. In response, Musk has threatened to launch a tender offer that he could use to register Twitter shareholder support for his bid.