Trading in Twitter shares halted as Elon Musk ‘plans to buy social media company for original offer price’ | Business News

Trading in Twitter shares was halted as the stock spiked following reports that Elon Musk is planning to buy the company for his original offer price.

The world’s richest man is proposing to go ahead with purchasing the social media giant for $54.20 per share, a total purchase value of $44bn following months of legal battles, according to Reuters, citing two sources.

The shares had been up by 13% at $47.95 before trading was paused following the news.

Twitter and Mr Musk were due to be in court later this month as the company attempted to hold Mr Musk to his original $44bn offer, made in April.

“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,” Dan Ives, analyst at investment firm Wedbush said.

Mr Musk, the Tesla CEO, had wanted to back out of the deal over the number of bot accounts on the platform.

He said it was above Twitter’s estimate of 5% of users and claimed in July that meant he could exit the deal.

Bots are automated accounts whose existence can lead to an overestimation of how many humans use the website. Knowing the number of genuine users is important for advertising sales and the overall value of the platform.

The takeover deal had received approval from Twitter shareholders last month.

More than $16 billion worth of Tesla shares had been exchanged as of midday New York time on Tuesday resulting in a stock value plunge which rebounded in afternoon trading.

The proposal by Mr Musk may ends months of turbulent litigation which was heading into a face-off in Delaware’s Court of Chancery on 17 October.

The settlement Twitter purchase is expected to give the outspoken Mr Musk another megaphone for his views.

In the past he has taken to Twitter to stir controversy, such as suggesting a peace plan for the Ukraine-Russia war
that drew swift condemnation from Ukraine’s president, Volodymyr Zelenskyy, and said he would overturn former president Donald Trump’s ban from the site.

According to text messages that came to light during the litigation, Mr Musk planned to change the platform by battling spam by verifying accounts; hosting money transfers, and wanted to create Twitter subscriptions instead of relying on advertising.