Topline
The world’s wealthiest man Elon Musk has lastly accomplished his $44 billion deal to take over Twitter, in accordance to a number of studies Thursday night, and rapidly went to work rebuilding the corporate to his imaginative and prescient, firing executives like CEO Parag Agrawal—that is what might change on the platform, on the firm and for Musk and his different ventures.
Elon Musk’s Twitter buy is now remaining after six dramatic months.
Key Info
Government ousters: Certainly one of Musk’s first orders of enterprise gave the impression to be displaying a number of high executives the door, together with Agrawal and CFO Ned Segal, CNBC first reported Thursday evening.
Huge layoffs: Musk plans to fireplace about 75% of Twitter staff when he takes energy, based on paperwork and interviews obtained by the Washington Publish final week, indicative of Musk’s often-hostile relationship with Twitter and sharp criticism of its content material moderation insurance policies, beforehand accusing its workers of getting a “sturdy left wing bias” (Musk reportedly instructed Twitter workers Wednesday the 75% determine is inaccurate).
Altering Twitter’s consumer expertise: Musk has floated a number of modifications to the positioning, together with charging a small charge, decreasing the variety of pretend and spam accounts from the positioning, altering the content material algorithm to boost “free speech,” loosening its moderation guidelines and including an edit button for all customers.
Attainable return of Trump (and Kanye): Musk stated in Could he plans to revive the Twitter account of former President Donald Trump, whom the platform banned in January 2021 “because of the threat of additional incitement of violence” following the lethal Capitol riot, although Trump claims he wouldn’t rejoin and can as an alternative stay on his new Fact Social web site—Musk has additionally beforehand stood by Kanye West, calling the rapper his “pal” earlier than Twitter banned West earlier this month for threatening violence in opposition to Jews.
Additional Tesla unloading: Wedbush analyst Dan Ives estimated final week that Musk might have to promote one other $5 to $10 billion in Tesla inventory to finance the deal, including to the roughly $30 billion he’s already bought this yr, and shares of Tesla are down greater than 40% since April 4, when Musk disclosed his 9% stake in Twitter, largely on account of issues about Musk’s selloff and the social media agency pulling his consideration away from the electrical automobile agency.
X app: Musk has stated he might use his new $44 billion plaything to construct out what he calls his X “every little thing app,” a cellular app which might deliver collectively quite a lot of unrelated companies like social media, messaging, meals supply and funds below the identical umbrella, within the mannequin of Tencent’s WeChat in China.
Key Background
Musk and Twitter had a court-imposed Friday deadline to both shut the acquisition or face a trial that would have resulted in a decide forcing him to purchase Twitter. Musk seemingly confirmed the deal would undergo Wednesday when he modified his Twitter bio to “Chief Twit” and shared a video of him on the firm’s headquarters, and the New York Inventory Trade suspended Twitter buying and selling for Friday in anticipation of the deal closing. Twitter accepted Musk’s unsolicited bid for the corporate in April, valuing the corporate at $54.20 per share, a couple of 30% premium. In July, Musk formally tried to again out of the deal, claiming the corporate knowingly misled him in regards to the presence of bots on the positioning, prompting Twitter to file a lawsuit in Delaware’s Chancery Court docket to pressure by way of the acquisition. Musk instructed Twitter October 3 he would transfer ahead with the deal on the unique phrases, avoiding the Delaware trial initially slated to start October 17. A Bloomberg report final Thursday in regards to the Twitter deal dealing with a potential nationwide safety evaluation on account of Musk’s friendliness with Russia briefly spooked buyers on the chance of the deal going by way of, although the White Home denies any such evaluation is underway. Twitter and Musk didn’t instantly reply to Forbes’ request for remark.
Essential Quote
“The $44 billion price ticket for Twitter will go down as probably the most overpaid tech acquisitions within the historical past of M&A offers,” Ives stated in a Thursday notice to shoppers, estimating a $25 billion true market worth for Twitter.
Tangent
Twitter inventory traded as little as $32 this summer time as doubts in regards to the deal ever closing peaked. Traders betting on the deal going by way of make out like bandits, together with billionaire Carl Icahn, who the Wall Road Journal studies stands to revenue as a lot as $250 million after shopping for up greater than $500 million in Twitter shares at about $35 this summer time.
Forbes Valuation
We estimate Musk to be value $221.5 billion, making him the wealthiest particular person on the planet by $62 billion. Musk’s fortune has tumbled greater than $100 billion this yr as Tesla’s inventory crashes from its pandemic peak.
