Elon Musk and Twitter would do everything to complete the takeover on time. After months of battles and complaints, the two parties are said to have started cordial negotiations. However, a final obstacle may complicate the acquisition.
After months of legal war, Elon Musk and Twitter would have finally managed to common ground. According to our colleagues at Bloomberg, the takeover procedure would be finalized before the deadline of October 28, 2022 set by the American courts. Citing a person familiar with the negotiations, the outlet says bankers and lawyers for both parties are currently preparing the final documents needed for the acquisition. The talks between Musk and Twitter would have returned “cordial”.
Now they focus on the closing of the takeover rather than the points of contention in recent months, such as the number of fake accounts on the social network. For the record, Elon Musk has agreed to buy Twitter at the price agreed last April, namely 44 billion dollars.
Read also: Will Elon Musk turn Twitter into a copy of WeChat?
Elon Musk’s loan
It is not known what allowed the conflict to calm down. In early October, after Elon Musk’s latest about-face, Twitter firmly refused to withdraw its complaint. Fearing that the boss of Tesla will once again change his mind, the social network wanted to maintain the trial at all costs.
As part of the finalization of the takeover, the banks having agreed to lend money to Elon Musk review the latest financing points. To get his hands on the platform, the billionaire indeed negotiated the loan of 13 billion dollars. A total of seven investment banks, led by Morgan Stanley, are involved in the process. Unless surprise, the funds should be released shortly.
Mass layoffs and moderation
The source interviewed by Bloomberg also evokes the ambitions of Elon Musk. Apparently, the billionaire is determined to lay off up to 75% of the company’s employees to cut costs. Thanks to that massive downsizing, the entrepreneur hopes to double Twitter’s turnover within three years.
At the same time, Elon Musk should focus on easing content moderation on Twitter as a priority. Openly libertarian, the entrepreneur has never hidden his intention to authorize outrageous positions, as long as they are within the limits of the law.
As part of this relaxation, controversial personalities, banned from Twitter for offensive remarks, could well make a comeback, the source believes. This would be particularly the case for donald trump, the former President of the United States. Excluded following the attack on Capitol Hill, which marked the last days of his presidency, Trump could be authorized to relaunch his account. Other personalities, such as rapper Kanye West, could benefit from the changes made by Elon Musk.
Last obstacle before the takeover?
Despite the end of tensions, Elon Musk still has to avoid a major obstacle before getting his hands on Twitter. Indeed, Biden administration officials are considering taking an interest in the transaction. The acquisition offer could be subject to a national security review.
According to Bloomberg, the government is concerned that Elon Musk has associated with a group of foreign investors, including Al-Walid bin Talal, a Saudi businessman, and Qatar’s sovereign wealth fund, to arrange the takeover. In this context, the United States Foreign Investment Committee could be tasked with taking a look at Elon Musk’s operations.
Faced with these uncertainties, Twitter’s stock market fell sharply. During the day of October 21, the group’s share lost 10% of its value, before stabilizing around 49 dollars.