Musk Seals $44 Billion Deal Even He Wasn’t Sure Would Succeed

Even Elon Musk was skeptical that he’d win. “I’m not sure that I will actually be able to acquire it,” Musk said in an interview at a TED conference on April 14.

The world’s richest person proved the naysayers, including himself, wrong Monday when he clinched a deal to buy Twitter Inc. for about $44 billion, using one of the biggest leveraged buyout deals in history to take private a 16-year-old social networking platform that has become a hub of public discourse and a flashpoint in the debate over online free speech.

Investors will receive $54.20 for each Twitter share they own, the company said in a statement Monday. The price is 38% more than the stock’s close on April 1, the last business day before Musk disclosed a significant stake in the company.

Reaching the agreement was the culmination of a months-long saga that saw Musk amass 9% of Twitter’s shares; launch a fusillade of criticism at Twitter’s management; rebuff an invitation to join the company’s board; and then announce an offer that many people first construed as a weed joke. Twitter was so cool on the proposal that it adopted a so-called poison pill defense that would effectively dilute Musk’s stake if it got much bigger. Twitter’s board soon came around, persuaded by an elaborate $25.5 billion debt financing plan from Morgan Stanley and a who’s who of other global investment banks.

Getting to yes with Twitter’s directors, though, is only the first step in what’s likely to be an arduous experiment for Musk. The outspoken entrepreneur has hinted at a long list of changes he wants to make at the social-media platform, including removing restraints on speech, while at the same time casting doubt on the advertising model that accounts for the bulk of Twitter’s revenue. He’s on record as saying he’s not in it for the money. “I don’t care about the economics at all,” Musk said at TED.

“Musk is going to want to grow users and monetize, but the challenge of Twitter is that you have a highly engaged base that doesn’t generate a lot of revenue,” said Gene Munster of Loup Ventures. “When Elon talks about unlocking value, is he talking about free speech, or making money?”