Elon Musk secures deal to acquire Twitter
The deal is expected to happen in three to six months, and it's likely that the company might go private.
Elon Musk, the world's richest person according to recent statistics, secured a deal to acquire Twitter. Musk first became the largest shareholder of the company before offering to buy it out for $54.20 a share - valuing the company at roughly $44 billion.
Though the Twitter board of directors unanimously approved the sale, the deal will still need to be approved by shareholders and subject to regulatory review. Twitter CEO Parag Agrawal said he expects the deal to close in the next three to six months time.
The deal, however, could fall through for various reasons, such as Musk not being able to secure the funding, due to unforseen circumstances such as his Tesla holdings dropping, or there is the possibility of regulators to step in and slow down the process, or reverse it.
Twitter is likely going private
Musk has said that part of the reason he wanted to acquire Twitter is because the changes that need to be made to the platform can only be done if it's a private company.
Twitter co-founder and ex-CEO Jack Dorsey shares the same sentiment with Musk, who tweeted that the company has been owned by Wall Street and the ad model.
Culture shock incoming
The future of the company is uncertain at this point. According to Twitter CEO Parag Agrawal, reported by Reuters, once the deal closes, the direction the platform will go is unknown at this time.
Many employees at Twitter are worried that with Elon Musk at the helm, the culture of diversity that's considered the DNA of twitter's tech organization might erode.
Much of these worries come from how Tesla has been hit by a series of discriminatory lawsuits. Musk is not known to care much about inclusivity at the workplace.
Agrawal told employees that no layoffs are planned at this time, but it's likely to see a hiring freeze. Twitter re-opened its offices in March, but employees can decide where they work, including being remote full-time. This arrangement could change once Musk take over Twitter.
Open-source algorithm
According to a statement released by Musk, the platform will be further enhanced with new features, defeat spam bots and the algorithm of the platform will be made open source to increase trust.
Critiques of open-sourcing the algorithm emphasizes that making the algorithm publicly available on the internet is not going to solve Twitter's problems. Proving the existence or absence of biases that may be subtle in nature and depend on changing factors may prove to be far more difficult.
Banned accounts, edit button, subscriptions?
Musk as long been vocal in his criticism of the platform's content policies, such as banning former US President Donald Trump from the platform.
In early April, Musk posted a series of now-deleted tweets describing potential changes to Twitter's subscription services and getting rid of adverts.
Musk also asked his followers if they wanted an edit button in a Twitter poll.
Financing the deal
According to CBNC, Musk has secured $25.5 billion of fully committed debt and marginal loan financing is providing an approximately 21.0 billion equity commitment. There are no financing conditions to the closing of the transaction.
