"Love me tenderly"
On April 16, Elon Musk tweeted this thoughtlessly, adding a few jumping notes, looking like he was purely enjoying Elvis' hit of the same name; but Elon Musk is the most famous second-year teen on the planet, and he sometimes loves this kind of plain encryption puzzle game that makes the world dance with him, forced to guess his mind and his mood.
The witty media immediately pointed out that in addition to the meaning of "gentle" in English, tender will also appear in financial proper nouns. The so-called Tender offer refers to the acquisition by the acquirer by issuing a written opinion to the shareholders of the target company to purchase the shares held by the company, and in accordance with the acquisition conditions, price, period and other provisions stipulated in the legally announced acquisition offer. , the acquisition method of acquiring the shares of the target company.
And Musk recently planned to acquire one of the world's largest social media platforms, Twitter.
Is Musk serious?
Musk's desire to acquire Twitter initially seemed like a pure "mouth gun".
On April 4, 2022, Elon Musk revealed that his Twitter stake reached 9.2%, making him Twitter's largest outside shareholder. At the beginning, he decided to join the Twitter board of directors. The new Twitter CEO Parag Agrawal announced the news. Musk also responded by saying that he was looking forward to working with Parag Agrawal and the Twitter board of directors in the future. Major improvements to Twitter in a few months. Then just a week later, on April 10, Musk reversed that decision. The most unexpected thing happened on April 14th, the day Musk gave a TED talk, and at that speech, Musk announced without warning that he was going to buy the rest of Twitter and push Twitter to go private. .
At this time, most people still think that Musk is not particularly serious. After all, as the 50-year-old richest man in the world and a well-known middle-schooler, Musk's willfulness is as dazzling as his wealth and talent; and in the repeated process of joining or not joining the Twitter board, Musk also launched a Twitter campaign. Several votes, including asking netizens if they agreed that the "w" in Twitter's name should be dropped and become titter, meaning "soft laugh", made it sound like he was buying Twitter Even more unreliable.
Of course Musk has the ability to acquire Twitter. His offer for Twitter was $54.20 per share, meaning he valued Twitter at about $43 billion, well above Twitter's market value of $36 billion at the time. And what about Musk himself? He was worth $208 billion at the time of the offer, mostly from his Tesla stock holdings, but it also meant that money wasn't an issue for him.
So what's the problem?
The motive for Musk's acquisition of Twitter has always been ambiguous to the outside world.
As a social platform, Twitter is a mess from a business point of view. Its user data is far less than that of rivals Facebook and TikTok, and its feature updates are often untouched and often annoyed. existing users. And its advertising strategy has not changed much since its inception in 2006. However, Twitter remains "a battleground" in social and cultural debates, so Twitter's decision to block former US President Donald Trump's account sparked an uproar, even after it was made After the decision, Twitter is still the most used platform for people to express their opinions.
So today's Twitter is like this: chaotic, undervalued, but hugely influential. This makes it a precarious prey, and if it is taken over by some private capital, will it be transformed into a more stance-oriented propaganda tool by its new boss, or will the new boss say a word Why don't you just close this platform? In order to avoid this risk, the Twitter board itself hardly holds much Twitter stock, and when they invited Musk to join, they also asked him not to hold more than 14.9% of the shares in his personal capacity or as a member of the group, so as not to have too large a stake. The right to speak.
Since Musk made a takeover offer on April 14, Twitter's share price has fallen from $45.08 per share to $38.29 (the closing price of the US East on May 20), a cumulative decline of more than 15%; what's worse, Tesla La's shares have fallen more than 25% over the same period.
Musk initially accepted the restriction, but after a few days, he changed his mind.
Musk, who claimed that his reason for trying to buy Twitter was not for money, said he wanted to reform Twitter and return it to its original vision of becoming a "civic square for free speech." Considering that Musk himself is a Trump supporter who has been banned from Twitter, the Twitter board's concerns are all the more justified.
dark battle choose side
Founder Jack Dorsey, who just stepped down as Twitter's CEO once again, sided with Musk, slamming Twitter while praising Musk for "deeply caring about our world and Twitter's role in it." The board's "dysfunction" in the face of Musk. Later, Twitter stated in its SEC filing that Musk had approached Dorsey as early as March 26 to "discuss the future of social media, including the benefits of open source social media protocols." The so-called open source social media protocol is a dream that Dorsey has been trying to achieve. He believes that social media should be decentralized, and open source protocols help avoid social media being controlled by any individual or company. Dorsey had consulted and discussed the issue several times with other members of Twitter's board of directors before approaching Musk, according to the Twitter filing.
On the other hand, Prince Alwaleed of Saudi Arabia clearly expressed his opposition to Musk’s tender offer. He holds 5.2% of Twitter’s shares and is one of Twitter’s most important individual shareholders. And his reason for objecting is that "Musk's offer is too low." He believes that Twitter's true value is far more than $43 billion.
Those retail investors who have made a lot of money with Musk in events such as GameStop are unsurprisingly on Musk’s side, especially for rookie investors who are highly susceptible to rhetoric and “memes”. , the stock market is the arena, Wall Street is the enemy, and Musk represents the right direction. So, Twitter's stock jumped 27% immediately after Musk announced that he owned 9.2%; according to Bloomberg, a 57-year-old retail investor read the news of Musk's takeover bid for Twitter , immediately bought 10,000 shares of Twitter, because he believed that Musk's investment vision would not let him down.