Elon Musk has indicated he wants to move forward with his Twitter buyout at the original $54.20 a share offer price, likely heading off a legal fight over the contentious transaction.
“We write to notify you 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 and pending receipt of the proceeds of the debt financing contemplated thereby,” Musk’s legal team said in a letter to Twitter’s legal council dated October 3.
After pursuing the acquisition in April, Musk attempted to back out of the deal, claiming Twitter had misled him and investors on the quality of its customer base and the number of fake accounts.
The company subsequently filed suit against Musk to force completion of the transaction at a full $54.20 per share, with a key court date set for October 17. And last month, Twitter shareholders voted to approve the proposed bid, with 98.6% backing the move.
“We received the letter from the Musk parties which they have filed with the SEC. The intention of the company is to close the transaction at $54.20 per share,” Twitter said in a statement released later Tuesday.
The legal case could now be on hold, according to Musk’s legal letter, which stated that the deal could go through “provided that the Delaware Chancery Court enter an immediate stay of the action, Twitter vs. Musk….and adjourn the trial and all other proceedings related thereto pending such closing or further order of the Court.”
In the letter, Musk’s team stressed that the willingness to close the deal under original terms was not an “admission of liability.”
Musk’s change-of-heart comes after reports that Hollywood agent Ari Emanuel was attempting to broker a settlement between Musk and Twitter, though there is no immediate indication that intervention resulted in Musk renewing the deal.
Twitter’s stock closed at $52 per share Tuesday, up over 22% and reversing months of steep declines.
Short seller Hindenburg Research was among the first activist investors to profit from the stock’s volatility.
In May, Hindenburg disclosed a short position in Twitter predicting Musk was likely to seek a lower takeover price on grounds it was overvalued. Within days the social media’s stock fell on fears Musk would push for a renegotiation, eventually losing as much as 30% of its value.