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Terms and Conditions

Elon Musk's acquisition of Twitter was finalized on October 27, 2022, with shareholders receiving $54.20 per share, a 38% premium over the stock price prior to Musk's stake disclosure. The deal involved Musk providing approximately $21 billion in equity and securing $25.5 billion in debt financing. Legal disputes arose when Musk attempted to terminate the deal over alleged misrepresentation of user data, but the acquisition proceeded as originally agreed after a lawsuit from Twitter.

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24 views1 page

Terms and Conditions

Elon Musk's acquisition of Twitter was finalized on October 27, 2022, with shareholders receiving $54.20 per share, a 38% premium over the stock price prior to Musk's stake disclosure. The deal involved Musk providing approximately $21 billion in equity and securing $25.5 billion in debt financing. Legal disputes arose when Musk attempted to terminate the deal over alleged misrepresentation of user data, but the acquisition proceeded as originally agreed after a lawsuit from Twitter.

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Elon Musk’s Twitter Takeover:

TERMS AND CONDITIONS


1) Purchase Price and Shareholder Agreement

 Offer Details: On April 25, 2022, Twitter agreed to be acquired by an affiliate of Elon
Musk. Under the terms of the agreement, Twitter stockholders would receive $54.20 in
cash for each share of Twitter common stock they owned upon closing of the proposed
transaction. This purchase price represented a 38% premium to Twitter’s closing stock
price on April 1, 2022, the last trading day before Musk disclosed his approximately 9%
stake in Twitter. sec.gov
 Shareholder Approval: Twitter's board unanimously approved the acquisition, and on
September 13, 2022, Twitter shareholders voted to approve Elon Musk's bid to buy the
company. en.wikipedia.org

2) Financing the Acquisition

 Equity and Debt Financing: Musk committed to provide an equity contribution of up to


approximately $21 billion. Additionally, debt financing of approximately $13 billion was
secured through commitment parties, and margin loan financing of approximately $12.5
billion was arranged, with the proceeds to be made available to the acquisition subsidiary.
sec.gov

3) Merger Agreement Provisions

 Structure: The agreement stipulated that an acquisition subsidiary would merge with and
into Twitter, with Twitter surviving the merger and becoming a wholly owned subsidiary
of Musk's parent entity. sec.gov
 Termination Clauses: The merger agreement included provisions for a $1 billion
termination fee payable by either party under specific circumstances, such as failure to
consummate the merger or breaches of representations, warranties, or covenants. sec.gov

4) Disputes and Legal Proceedings

 Attempted Termination: In July 2022, Musk announced his intention to terminate the
deal, alleging that Twitter misrepresented user data, particularly concerning spam and bot
accounts. bloomberg.com
 Legal Action: Twitter filed a lawsuit to enforce the merger agreement, asserting that
Musk's termination attempt was invalid. sec.gov
 Deal Closure: On October 4, 2022, Musk proposed proceeding with the acquisition on
the original terms, and the deal was finalized on October 27, 2022. wsj.com

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