Twitter executives insist sale to Elon Musk not ‘on hold’
Twitter Inc. executives told employees Thursday that the $44-billion deal to sell the company to billionaire Elon Musk is moving forward as planned, and that they won’t renegotiate the agreed-upon price of $54.20 per share.
Vijaya Gadde, Twitter’s top lawyer and head of policy, also told workers at an all-hands meeting that there is “no such thing as a deal being on hold,” according to people who attended the meeting. She was pushing back on claims from Musk over the past week that he is pausing the deal while he learns more about the number of bots and spam accounts on the social-media service.
Twitter stock jumped about 2% on the news of the meeting, which was first reported by Bloomberg. Earlier the shares had declined by as much as 1.7%. Shares were trading below $38 on Thursday, suggesting Wall Street believes a low likelihood of the deal being consummated at the agreed-upon price.
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Other top Twitter executives, including Chief Executive Officer Parag Agrawal and finance chief Ned Segal, also addressed employees, said the people, who asked not to be identified discussing internal business. The companywide video call was intended for leadership to discuss the deal and provide more details following Twitter’s filing of its proxy statement with the Securities and Exchange Commission this week, which outlined the transaction’s history and terms.
Executives addressed a number of questions about the transaction, including whether Twitter would try to legally force Musk to buy the company based on his agreement. Gadde assured employees that Musk must “do everything he can” to make sure he gets his financing in order, and that it’s possible Twitter could try and “enforce” the terms of the deal “if we ever needed to do that in a court.” She added that getting to that step would be “pretty rare.”
Musk earlier this week suggested he would be interested in renegotiating his deal for Twitter. The company’s stock is currently trading at $37.45 per share, well below the offer price.
Thursday’s all-hands assembly was the latest in a string of internal meetings intended to help employees better understand the sales process. Segal discussed the gap in Twitter’s stock price and Musk’s offer, explaining to staff how this reflected some doubt that the deal would go through. He also said executives are still engaging with Musk and his team, and working with them “regularly” throughout the process to prepare for the possibility of Musk taking over. Segal also discussed how Twitter’s board came to the decision to sell to Musk, which included an analysis of Twitter’s business projections if a deal didn’t happen.
Gadde added that she believes Musk will be able to vote his shares at Twitter’s annual shareholder meeting, which is scheduled for Wednesday. The shareholder vote on whether to approve the deal will take place at a later date.
Twitter has been in a state of limbo since the company’s board accepted an offer from Musk in late April. Musk has continued to criticize Twitter and its policies despite agreeing to the deal, and recently suggested the company was lying about the number of daily users that would be categorized as spam. He said the deal was “on hold” until he got more information. After Agrawal posted a long thread earlier this week explaining Twitter’s methodology for counting spam accounts, Musk replied to the CEO with a poop emoji.
Bloomberg writers Dana Hull and Ed Ludlow contributed to this report.