It’s official. Elon Musk’s bid for Twitter has been approved.
The social media platform announced this week that it has approved the Tesla CEO’s $44 billion acquisition bid.
The company’s board met over the weekend to discuss Musk’s financing plan for the proposed bid said a source close to the situation told CNBC. The billionaire had agreed to buy Twitter for $54.20 a share, or about $44 billion.
The stock rose 5.9% to $51.79 as Wall Street digested the news.
Elon Musk’s Twitter buyout is a success for shareholders according to Wedbush’s Dan Ives.
Twitter had been expected to decline a deal and had adopted a so-called poison pill to fend off a potential hostile takeover, but the company became more receptive to a bid after Musk revealed he secured $46.5 billion in financing.
The board negotiated with Musk into the early hours of Monday, according to The New York Times.
“I think they almost have to” take the deal, CNBC’s Jim Cramer said Monday on “Squawk on the Street.”
Twitter will be reporting its first-quarter earnings Thursday, and some, including Cramer, expect the company to post disappointing results.
“Locking a deal up today or tomorrow may sound pretty appealing for someone who knows they are in possession of bad news,” Gordon Haskett said.
Musk had built up more than 9% in stock and turned down an offer to join the board before putting in a bid for the company. He thinks the platform needs to be “transformed” into a private company so it can become a forum for free speech. He’s also said that Twitter’s board members’ interests “are simply not aligned with shareholders” and that the board “owns almost no shares” of the company.
Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.