With just one week left before a judge’s deadline for his $44 billion acquisition of Twitter, tech billionaire and world’s richest man Elon Musk claims he is “clearly overpaying” for the social media platform.
Controversies surrounding Musk’s acquisition of Twitter have included litigation and a probable impending trial.
Musk is purchasing the social media platform for $54.20 per share, matching his April bid, despite sources previously told Insider that he nearly obtained an 8% discount.
“Although obviously myself and the other investors are obviously overpaying for Twitter right now, the long-term potential for Twitter in my view is an order of magnitude greater its current value,” Musk, who is Tesla’s CEO, said at the electric-vehicle maker’s earnings call Wednesday, per a transcript of the call from Insider’s Tim Levin.
“I’m excited about the Twitter situation, because obviously I know their product incredibly well,” he said. “And I think it’s an asset that has sort of languished for a long time but has incredible potential.”
Bloomberg believes that Musk has a net worth of $209 billion, making him the richest person in the world.
After acquiring a 9.2% share, making him the company’s largest shareholder, Musk made his initial offer to purchase Twitter in April. He had also been attempting to join the board of directors.
However, the following month he appeared to be less certain about purchasing the website, and in July he wrote to Twitter to cancel the agreement, claiming that the social media juggernaut had hidden or falsified information concerning the amount of bot accounts on the network. According to Twitter, less than 5% of its 238 million daily active users who are monetized are bots.
Within days, Twitter sued Musk, accusing him of “refusing to honor his obligations.” Musk countersued later in July, alleging that the company intentionally miscounted the number of spam accounts as part of what he called “its scheme to mislead investors about the company’s prospects.”
After months of Musk trying to abandon the deal, it is now back on the cards.
Talks to buy the company for $50 a share fell through after the two sides clashed, with Musk’s attorney saying that Twitter’s executives and board wanted “all kinds of things” in the renegotiated deal that the tech mogul refused to accept. Musk’s lawyers ultimately said he would renew the original offer at $54.20 a share on October 4.
The judge overseeing Twitter’s case against Musk in Delaware Chancery Court has agreed to halt proceedings in the case until October 28 to give them time to to close on the transaction, or otherwise the parties will face a trial in November. Musk’s legal team has said the deal can close by then.
Bloomberg reported that Twitter froze its employees’ ability to access and trade shares on Monday in a sign that Musk’s deal is close to completion.
