WASHINGTON (Parliament Politics Magazine) – Twitter’s board has approved of Elon Musk’s $44 billion (£34.5 billion) takeover offer.
Mr Musk, who made the surprise proposal less than two weeks ago, claimed that Twitter had “tremendous potential” that he would unleash.
He also demanded a slew of adjustments, ranging from loosening content restrictions to eliminating bogus accounts.
The company first turned down Mr Musk’s offer, but it will now put the proposal to a vote among shareholders.
According to Forbes magazine, Mr Musk is the world’s richest person, with a net worth of $273.6 billion, owing mostly to his ownership of electric vehicle producer Tesla, which he also controls. He is also the CEO of SpaceX, an aerospace company.
Announcing the deal, Mr Musk said in a statement that free speech was a functional democracy’s backbone, and Twitter was the digital town square where subjects crucial to the future of humanity were debated.
“I also want to make Twitter better than ever by enhancing the product with new features, making the algorithms open source to increase trust, defeating the spam bots, and authenticating all humans,” he continued.
“Twitter has tremendous potential – I look forward to working with the company and the community of users to unlock it.”
The move comes as politicians and regulators put increasing pressure on Twitter over the content that appears on its site. Its efforts to moderate misinformation on the site have garnered criticism from both the left and the right.
It banned Donald Trump, the former US President, possibly its most influential user, last year in one of its most high-profile measures, citing the possibility of “incitement of violence.”
A lot of people were going to be really angry with West Coast high tech being the de facto arbiter of free expression, Mr Musk said at the time.
The right in the United States has reacted positively to the news of the takeover, though Mr Trump told Fox News on Monday that he had no plans to return to the platform.
“No matter who runs or owns Twitter, the president has long been worried about the power of huge social media platforms,” White House spokesperson Jen Psaki told reporters, after the House refused to comment on the buyout.
The purchase was described as an “amazing development in the world of social media” by Julian Knight, head of the Digital, Culture, Media and Sport Committee of the UK, on Twitter.
It would be interesting to observe how a privately held Twitter (led by a man who was a free speech absolutist) reacts to worldwide regulatory efforts, he said.
Is it possible for Musk to turn Twitter around?
Twitter’s shares will be delisted and the company will be taken private as part of the takeover, which is scheduled to close later this year.
Mr Musk claims that this will allow him to make the changes he wants to the company.
He has proposed, among other things, enabling longer posts and allowing users to alter them after being published.
Following the announcement of the acquisition, Twitter’s shares rose more than 5% on Monday.
However, it remained below Mr Musk’s $54.20 per share bid, indicating that Wall Street reckons he is overpaying for the company.
Mr Musk has stated that he is unconcerned about the purchase’s finances. He will, however, be taking on a company with a shaky financial track record.
Despite its popularity, Twitter has never made a profit, and user growth has stagnated, notably in the United States.
The company, which was started in 2004, finished 2021 with $5 billion in revenue and 217 million daily users worldwide, far less than rival platforms such as Facebook.
Twitter’s board chair, Bret Taylor, said the company had thoroughly evaluated Mr Musk’s offer and that it was “the best way ahead for Twitter’s stockholders.”
It’s unclear who will be in charge of the company in the future. Parag Agrawal, who took over from former boss and co-founder Jack Dorsey in November, is the current CEO of Twitter.
Mr Musk, on the other hand, stated in his offer document to Twitter’s board of directors that he didn’t have confidence in the management.
On Monday, Mr. Agrawal reminded Twitter staff that the company’s future is uncertain.
According to the Reuters news agency, he said that once the deal closed, they didn’t know which direction the platform would go.