Elon Musk struck a deal on Monday to buy Twitter for roughly $44 billion, in a victory by the world’s richest man to take over the influential social network frequented by world leaders, celebrities and cultural trendsetters.
Twitter agreed to sell itself to Musk for $54.20 a share, a 38% premium over the company’s share price this month before he revealed he was the firm’s single largest shareholder. It would be the biggest deal to take a company private — something Musk has said he will do with Twitter — in at least two decades, according to data compiled by Dealogic.
“Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated,” Musk said in a statement announcing the deal. “Twitter has tremendous potential — I look forward to working with the company and the community of users to unlock it.”
The blockbuster agreement caps what seemed an improbable attempt by the famously mercurial Musk, 50, to buy Twitter — and immediately raises questions about what he will do with the platform and how his actions will affect online speech globally.
The billionaire, who has more than 83 million followers on Twitter and has romped across the service hurling gibes and memes, has repeatedly said he wants to “transform” the platform by promoting more free speech and giving users more control over what they see on it. By taking the company private, Musk could work on the service out of sight of the prying eyes of investors, regulators and others.
Yet scrutiny is likely to be intense. Twitter is not the biggest social platform — it has more than 217 million daily users, compared with billions for Facebook and Instagram — but it has had an outsize role in shaping narratives around the world. Political leaders have made it a megaphone, while companies, celebrities and others have used it to hone images and build brands.
In recent years, Twitter has also become a target of criticism, as some users spread misinformation and other toxic content on the service. Former President Donald Trump frequently turned to Twitter to insult and inflame, until it barred him after the Jan. 6 riot at the Capitol last year. The company has repeatedly created policies on the fly to deal with unexpected situations.
Musk himself has had a rocky relationship with online speech. This year, he tried to quash a Twitter account that tracked his private jet, citing personal and safety reasons. And he has gotten into trouble with regulators over his tweets.
On Monday, he tweeted that he hoped his worst critics would remain on Twitter, because “that is what free speech means.” He added in his statement that he hoped to increase trust by making Twitter’s technology more transparent, defeating the bots that spam people on the platform and “authenticating all humans.”
Bridget Todd, a director at UltraViolet, a women’s rights organization, said Musk’s deal could be treacherous for online speech because he might not be in favor of Twitter’s community standards and barring users who violated those standards.
“This is a massively slippery slope,” she said.
In Washington, Republicans, who have long accused Twitter of censoring their views, cheered Musk’s deal.
“I am hopeful that Elon Musk will help rein in Big Tech’s history of censoring users that have a different viewpoint,” Sen. Marsha Blackburn of Tennessee tweeted.
Trump told Fox News on Monday that he would stick with posting on his own social network, Truth Social. “I am not going on Twitter,” he said, but added that he hoped “Elon buys Twitter, because he’ll make improvements to it.”
Democrats were restrained on the deal. Jen Psaki, the White House press secretary, declined to comment on Twitter’s sale specifically but said that President Joe Biden “has long been concerned about the power of large social media platforms” and that they should be “held accountable for the harms that they cause.” She said Biden supported changes to online-speech and antitrust laws.
Beyond speech issues, Twitter faces questions about its business. For years, the company has struggled to gain new users and keep others returning. Its advertising business, which is the main way Twitter makes revenue, has been inconsistent. Twitter has not turned a profit for eight of the past 10 years.
Last year, the company lost $493 million on revenue of $5.57 billion. In contrast, Meta, the company formerly known as Facebook, had profits of $39 billion and revenue of $118 billion last year.
Twitter, which went public in 2013, has also had a tumultuous corporate history. It has repeatedly dealt with board dysfunction and drama with its founders, and was courted by other interested buyers in the past, including Disney and Salesforce. In 2020, activist investment firm Elliott Management took a stake in Twitter and called for Jack Dorsey, one of its founders, to resign as CEO. Dorsey stepped down last year.
“This company is very much undermonetized, especially compared to other platforms and competitors like Facebook,” said Pinar Yildirim, a professor of marketing at the University of Pennsylvania Wharton School of Business. “If you look at it from a point of pure business value, there’s definitely room for improvement.”
In a statement, Bret Taylor, Twitter’s chairman, said that the board had “conducted a thoughtful and comprehensive process” on Musk’s bid and that the deal would “deliver a substantial cash premium” for shareholders.
Regulators are unlikely to seriously challenge the transaction, former antitrust officials said, since the government most commonly intervenes to stop a deal when a company is buying a competitor.
The deal came together in a matter of weeks. Musk, who also leads the electric carmaker Tesla and the rocketmaker SpaceX, began buying shares of Twitter in January and disclosed this month that he had amassed a stake of more than 9%.
That immediately set off a guessing game over what Musk planned to do with the platform. Twitter’s executives initially welcomed him to the board of directors, but he reversed course within days and instead began a bid to buy the company outright.
Any agreement initially appeared unlikely because the entrepreneur did not say how he would finance the deal. Twitter’s executives appeared skeptical, too, given that it was difficult to discern how much Musk might be jesting. In 2018, for example, he tweeted that he planned to take Tesla private and inaccurately claimed that he had “funding secured” for such a deal.
Twitter responded to Musk’s offer by putting a “poison pill” in place, a defensive maneuver that prevented the billionaire from accumulating more than 15% of the company’s shares.
The skepticism began dissipating last week when Musk revealed in a securities filing that he had obtained commitments worth $46.5 billion to finance his offer for Twitter.
Morgan Stanley and a group of other lenders offered $13 billion in debt financing and another $12.5 billion in loans against Musk’s stock in Tesla. He was expected to add about $21 billion in equity financing. Twitter did not provide details of the equity financing Monday. It also set no conditions for Musk’s financing that would prevent him from closing the deal.
The financing commitments forced Twitter to weigh Musk’s bid seriously, people with knowledge of the situation have said, particularly as he threatened to take the offer directly to shareholders in a hostile bid.
Over the weekend, in a series of calls and video meetings, Twitter’s board and the billionaire’s deal makers hashed out terms for the purchase. The teams worked late Sunday and into Monday on the final details.
Twitter’s financial advisers were Goldman Sachs, JPMorgan Chase and Allen & Co., while Morgan Stanley was the lead financial adviser to Musk.
How hands-on Musk plans to be at Twitter is unclear. Among the unanswered issues are whom he might pick to lead the company and how involved he would be in running the service. In addition to leading Tesla and SpaceX, Musk has other companies, such as Neuralink, which aims to build a computer interface for the human brain, and the Boring Co., which makes tunnels.
Twitter’s current CEO, Parag Agrawal, took over in November. Agrawal has been working toward “decentralizing” the social network so that Twitter would make fewer content-moderation decisions and users would have more control over their social feeds. He is expected to remain in charge at least until the deal closes.
How many of Twitter’s employees want to pursue Musk’s vision is also uncertain. Some have been frustrated by the lack of communication over the takeover fight.
In a meeting with employees Monday afternoon, Agrawal and Taylor, the chairman, nodded to the emotions of the day and how workers were most likely processing the news of a sale.
“It’s important to acknowledge that all of you have many different feelings about what is happening,” Agrawal said in the meeting, which The New York Times listened to. He said it might take three to six months for the deal’s completion, so “in this moment, we operate Twitter as we always have.”
The deal, which has been approved by Twitter’s board, is expected to close this year, subject to a shareholder vote and certain regulatory approvals.
In the employee meeting, Agrawal acknowledged the uncertainty ahead. “Once the deal closes, we don’t know what direction this company will go in,” he said.