Twitter is re-examining Elon Musk’s offer to buy the social media company and has grown more willing to negotiate with the billionaire, the Wall Street Journal reported Sunday, days after the Tesla CEO announced he had secured $46.5 billion in financing for the purchase.
Musk met with some Twitter shareholders on Friday to discuss the deal, the Journal reported, citing unnamed sources, though he has reportedly continued to insist that he’s not willing to negotiate on his offer of $54.20 per share.
There is still no guarantee that Twitter is open to Musk’s terms, according to the Journal, and the decision partially hinges on whether the company’s valuation of itself is congruent with Musk’s offer, which values Twitter at about $43 billion.
Some shareholders have pressured Twitter’s board to negotiate with Musk, unnamed sources told Reuters Sunday, despite Musk explicitly stating in his offer letter the $54.20-a-share figure was his “best and final offer.”
Twitter declined Forbes’ request for comment, and Musk did not immediately respond to Forbes’ request for comment.
What To Watch For
Musk and Twitter executives are meeting again Sunday, and Twitter will likely discuss the offer by the time it releases first-quarter earnings Thursday, though it may not give the yes-or-no response Musk is demanding, according to the Journal.
Musk announced April 4 he had purchased 9.2% of Twitter, and he made an unsolicited offer to buy the entire company for $54.20 per share on April 14, but it was unclear at the time how he would pay for the deal. Though Musk’s net worth of nearly $270 billion makes him the richest person in the world according to Forbes’ estimates, much of his wealth is made up of illiquid assets such as Tesla shares. However, in a Thursday filing with the Securities and Exchange Commission, he revealed he would finance the purchase with more than $20 billion in loans from investment banks like Morgan Stanley and $21 billion in equity financing.
What We Don’t Know
If Twitter’s board of directors remains skeptical of Musk’s bid, he may try to skirt its decision through a “tender offer,” or an offer to buy shares directly from shareholders at a particular price, but would need broad shareholder backing to pull off such a maneuver. He would also need the board to eliminate Twitter’s “poison pill” plan, which makes it difficult for him to buy more than 15% of the company—a rule Twitter introduced a day after Musk announced his bid. The plan will remain in effect until April 14, 2023.