Musk-Twitter Deal One of the Largest Buyouts in History

Will he or won't he? After months of back and forth between Twitter and Elon Musk, who were scheduled to meet in court on October 17, the eccentric billionaire added yet another twist to the takeover saga. Musk, who had been trying to back out of the $44 billion deal for months, apparently changed his mind yet again and is now ready to honor the original proposal and buy Twitter at $54.20 per share. In a letter filed with the SEC, Musk's lawyers write that "the Musk Parties intend to proceed to closing of the transaction contemplated by the April 25, 2022 Merger Agreement, on the terms and subject to the conditions set forth therein" if Twitter immediately drops its lawsuit against Musk.

When an SEC filing revealed that Musk had become Twitter’s largest shareholder on April 4, hardly anyone could have predicted that he would go on to buy the entire company. Back then, the assumption was that he would probably join Twitter’s board and try to make his voice heard that way. After that option fell through, however, it was widely assumed that Musk would move on to greener pastures while possibly making a nice profit from selling his Twitter stake. Instead, Musk doubled down on his mission to improve what he called “the digital town square where matters vital to the future of humanity are debated." Claiming that Twitter had understated the prevalence of bots on its platform, Musk then tried to back out of the deal in July, only to find him himself sued by the company he was trying to buy.

As the following chart shows, Musk’s planned acquisition of Twitter, if it ever goes through, will be one of the largest leveraged buyouts in history. According to Twitter’s announcement of the deal back in April, Musk has secured $25.5 billion in loans, backed in part by his own assets and in part by Twitter’s assets, to finance the deal. He will also be providing roughly $21 billion in cash.