Twitter board approves proposed $44B sale of platform to Elon Musk
Twitter's board has recommended unanimously that shareholders approve the proposed $44 billion sale of the company to billionaire and Tesla CEO Elon Musk, according to a regulatory filing Tuesday.
Musk reiterated his desire to move forward with the acquisition last week during a virtual meeting with Twitter employees, though shares of Twitter remain far below his offering price, signaling that investors have considerable doubt that it will happen.
On Tuesday, speaking in an interview with Bloomberg at the Qatar Economic Forum, Musk listed the approval of the deal by shareholders as one of several "unresolved matters" related to the Twitter deal.
In a filing with the U.S. Securities and Exchange Commission on Tuesday detailing a letter to investors, Twitter's board of directors said that it "unanimously recommends that you vote (for) the adoption of the merger agreement." If the deal were to close now, investors in the company would pocket a profit of $15.22 for each share they own.
Shares of Twitter Inc. were up 1% Tuesday morning, hovering around $38, far short of the $54.20 per share that Musk has offered to pay. The company's stock last reached that level on April 5, when it offered Musk a seat on the board before he had offered to buy all of Twitter. Musk eventually declined the board seat on the day he was set to officially become a member. Twitter CEO Parag Agrawal at the time did not explain Musk's decision to reverse course, saying only that it was "for the best."
Layoffs at Tesla
In his Bloomberg interview Tuesday, Musk confirmed Tesla will be cutting its salaried workforce by about 10% over the next three months. Talk of layoffs at the electric carmaker were first reported in early June, when Musk said he wanted to slash jobs at Tesla based on a "super bad feeling" he has about the economy. Musk reiterated his concerns at the forum in Qatar, specifically in comments regarding the possibility of an impending recession. "It is not a certainty, but it appears more likely than not," the CEO said.
Tesla's stock has lost nearly one-third of its value since early April, shortly after Musk first suggested that he wanted to buy Twitter. Tesla employs roughly 100,000 hourly and salaried workers worldwide, according to a May filing with the Securities and Exchange Commission. A reduction of the size Musk projects would result in 3,000 to 3,500 job losses, according to Bloomberg.
Many technology companies that expanded during the pandemic are now pulling back, laying off workers and retracting job offers as the U.S. economy slows.