‘Let that sink in’ – Twitter stocks rise as Musk seen at headquarters

by Jacob Fuller

 

Billionaire Elon Musk said on Wednesday he was entering Twitter Inc’s San Francisco office, days ahead of a court-ordered deadline to close his $44 billion deal for the social media platform.

Musk tweeted, “Entering Twitter HQ – let that sink in!”

Earlier in the day, Musk teased being the top boss of Twitter, after he updated his profile’s bio to “Chief Twit”.

Twitter did not immediately respond to a Reuters request for comment.

Twitter plans to close its deal with billionaire Elon Musk on previously agreed price and terms, Anu Aiyengar, global co-head of mergers and acquisitions at JPMorgan Chase & Co, told a conference in New York.

Earlier this month, Musk proposed to proceed with his original $44 billion bid, calling for an end to a lawsuit by the social media company that could have forced him to pay up.

JPMorgan and Goldman Sachs are Twitter’s financial advisors.

Twitter stock rising in anticipation of Musk buyout

Twitter Inc’s stock inched closer to Musk‘s $54.20 per share buyout offer for the micro-blogging site on Wednesday, signaling that investors finally expect the deal to go through ahead of a court deadline at the end of this week.

Shares of the social media company were last up 0.3% at a near seven-month high of $52.94, the closest they have come to Musk‘s offer since it was announced in mid-April.

“Market doubt seems to be waning but has not yet completely gone away,” said Randy Frederick, managing director of trading & derivatives at Schwab Center for Financial Research.

In the six months of dramatic back-and-forth since Musk announced his bid, Twitter initially resisted the deal by adopting a poison pill and later sued the world’s richest man after he announced plans to abandon his offer on concerns about spam accounts on the platform.

Twitter shares dropped as low as $32.50 in July.

Earlier this month, Musk proposed to proceed with his original $44 billion bid, calling for an end to a lawsuit by the social media company that could have forced him to pay up, sending Twitter shares 24% higher.

Tesla CEO has notified co-investors who committed to help fund his $44 billion acquisition of Twitter that he plans to close his buyout of the social media firm by Friday, a person familiar with the matter told Reuters on Tuesday.

The banks providing $13 billion in financing for the deal have abandoned plans to sell the debt to investors because of uncertainty around Twitter’s fortunes and losses, Reuters reported last week.

“Wall Street is motivated to curry favor with Musk,” said Jason Benowitz, senior portfolio manager at The Roosevelt Investment Group LLC.

“Elon Musk leads significant businesses including Tesla, SpaceX, and soon, Twitter … that may require substantial capital raises in the future. If SpaceX were to one day have an initial public offering it would be a flagship deal for the investment banking industry.”

Copyright 2022 Thomson/Reuters

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