The billionaire’s plan to buy Twitter was proposed at a price of $54.20 per Twitter stock share.
The news that Elon Musk is prepared to acquire Twitter for $44 billion caused Twitter stock (NYSE:TWTR) to jump during trading on Tuesday.
During trading on Tuesday afternoon, Twitter shares increased by 13%, reaching $47.93 before trading was suspended due to the news article. Bloomberg first claimed that Musk had written a letter to Twitter recommending that they continue with the original purchase. The article cited people who were familiar with the situation. In a filing that he made with the Securities and Exchange Commission on Tuesday afternoon, Elon Musk revealed the contents of the letter. After then, trade was resumed, and the company’s stock finished the day 22% higher at $52.
In the letter, Musk’s attorneys stated that their client’s team wants to finalize the transaction, provided that the money from the loan financing is received. That is all on the condition that the court issues a stay of proceedings and postpones the trial as well as any additional actions awaiting the completion of the arrangement. The investor relations account for Twitter (NYSE:TWTR) acknowledged receiving the letter and said that the business aims to finalize the purchase at a price of $54.20 per share.
Musk, the co-founder and CEO of Tesla (NASDAQ:TSLA), had contended that discoveries concerning spam accounts and a whistleblower complaint permitted him to terminate the agreement ever since the two events occurred in April when they initially agreed that Musk would purchase Twitter.
Dan Ives, an analyst at Wedbush, described moving through with the plan rather than facing any legal obstacles as a prudent step.
Ives wrote on Tuesday that this “is a clear sign that Musk recognized heading into Delaware Court that the chances of winning vs. Twitter board was highly unlikely and this $44 billion deal was going to be completed one way or another.” “This is a clear sign that Musk recognized that the chances of winning vs. Twitter board were highly unlikely, and this deal was going to be completed one way or another,”
The trial between Musk and Twitter (NYSE:TWTR) was due to begin on October 17 in the Delaware Chancery Court, where it was expected that Musk would prevail. To force Musk to complete the transaction, Twitter filed a lawsuit against him. The shareholders of Twitter have already given their consent to the acquisition, which the firm stated at the time was the final permission or regulatory requirement necessary to finish the transaction. The trial was only one more obstacle along the way.
Barron’s received a response from professor Ann Lipton of Tulane Law School, who stated that the timing was not unusual. According to what she wrote, “A lot of cases settle on the eve of trial.”
In August, Musk sold $6.9 billion worth of Tesla stock, which caused some on Wall Street to suspect that the entrepreneur was trying to raise funds in the event that he was unable to get out of the arrangement with Twitter (NYSE:TWTR). The price of Tesla shares fell from its intraday high of $257.50 immediately after Bloomberg published its article on Tuesday, although it ended the day with a gain of 2.3% overall.
Featured Image: Megapixl @ Dolphfyn
Author Valerie Remorosa 
