(Bloomberg) -- Elon Musk is now the owner of Twitter Inc., capping months of speculation over whether he would complete the deal. It’s been a wild ride for all involved, but after several fits and starts, the company is finally in the hands of the tech billionaire who also runs Tesla Inc. and SpaceX. Here’s the timeline of how it came together.
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Jan. 31: Musk starts building his stake
The year begins with Musk quietly acquiring Twitter shares. By March 14, he accumulates over a 5% stake, the point at which he’s supposed to disclose the activity to the Securities and Exchange Commission — a misstep that later would trigger a shareholder lawsuit.
March 24: Musk starts criticizing Twitter, on Twitter
In late March, with his stake still secret, Musk begins lobbing criticism at the company: “Twitter algorithm should be open source,” he tweets on March 24. “Free speech is essential to a functioning democracy. Do you believe Twitter rigorously adheres to this principle?” he asks on March 25. “Is a new platform needed?” Musk says on March 26. “Am giving serious thought to this.”
April 4: Musk’s stake becomes public, and he’s invited to join Twitter’s board
It becomes known that Musk is Twitter’s largest individual shareholder, with more than 9% of the company. His filing lists him as a passive investor, but he’s been actively tweeting about changes to the business. That includes polling users on whether they want an edit button, which would allow people to change tweets after they’ve been published. By end of day, Twitter invites Musk to join the board contingent on him not owning more than 14.9% of the company’s stock.
April 5: Musk becomes an active investor
In the morning, several of Twitter’s board members take to the platform to congratulate Musk on his decision to join their ranks. Chief Executive Officer Parag Agrawal tweets that the company and Musk have been chatting for weeks. Later that day, Musk refiles his disclosure to classify himself as an active investor, after indicating that he would accept a seat on the social network’s board.
April 9: Musk rejects the board seat
Musk rejects the offer to join the board, and Twitter holds the news for roughly 36 hours while waiting to see if he will change his mind. He spends the weekend tweeting more suggestions for the business, like converting Twitter’s San Francisco headquarters into a homeless shelter “since no one shows up anyway” and charging for user verification, a service that has been free and reserved for notable figures.
April 10: Twitter announces Musk is not joining the board
On Sunday, Agrawal sends a note to employees about Musk not joining the board and later tweets it publicly. Neither Agrawal or Musk give a reason for the reversal.
April 11: Speculation abounds
Musk files an amended disclosure with the SEC. He can now purchase as many shares as he wants. Without a board seat, he doesn’t have to act in the best interest of Twitter shareholders. Within the company, which doesn’t have a founder with majority control like other tech giants, employees are “super stressed” and concerned that this is only the beginning of the turmoil.
April 14: Musk offers to buy the whole company
In an SEC filing and accompanying tweet, Musk says he would buy out stockholders in a cash deal then valued at $43 billion to take Twitter private. The offer is $54.20 a share, a 54% premium over the price when he started building his stake in January. Morgan Stanley is brought in to advise on the bid, which Musk describes as his “best and final” offer.
April 15: Twitter adopts ‘poison pill’ to ward off Musk takeover
To thwart Musk, Twitter launches a so-called poison pill, which is a rights plan that allows shareholders to purchase shares at a discount if any shareholder exceeds 15% ownership. It’s a tactic that would effectively dilute the billionaire’s stake. The company says that the intention of the plan is to ensure that anyone taking control through open-market accumulation will pay all shareholders an appropriate premium. Twitter begins to field interest from other parties, and is advised by Goldman Sachs Group Inc. and JPMorgan Chase & Co, among others. Twitter co-founder and former CEO Jack Dorsey, a friend of Musk, acknowledges in a tweet that as a public company Twitter has always been for sale.
April 16: ‘Twitter’s board owns almost no shares’
In a flurry of tweets about the potential deal, Musk says, “With Jack departing, the Twitter board collectively owns almost no shares,” so its economic interests are not aligned with shareholders. Dorsey replies, “It’s consistently been the dysfunction of the company.” Dorsey is scheduled to leave the board once his term expires at the next shareholder meeting on May 25.
April 21: Musk lines up $46.5 billion in funding
Musk says he’s secured $46.5 billion in funding. A filing with the SEC shows that he has $25.5 billion in debt financing from Morgan Stanley and other financial institutions, including margin loans backed by his equity stake in Tesla and $21 billion in equity financing from himself. But whether the billionaire will sell part of his stake in one of his prized companies to acquire Twitter remains to be seen.
April 25: Twitter agrees to be bought
Twitter yields to Musk’s original offer of $54.20 a share. The transaction, valued at about $44 billion, will take the company private. Musk says he will prioritize free speech on the site, make its algorithms open-source, eliminate spam and add new features. Twitter says it expects the deal to close this year.
April 29: Musk sells Tesla stock
Musk discloses an additional $4.5 billion worth of Tesla stock sales in new regulatory filings, followed by disclosures of 4.4 million shares sold the two prior days, bringing the total to around $8.5 billion that he’s disposed of in the process of buying Twitter. Musk has now sold about $25 billion worth of stock in the electric-car maker during the last six months.
May 4: Billionaire backers pony up additional funds
Musk raises an additional $7.1 billion to fund the transaction. Backers include Oracle Corp. co-founder Larry Ellison, who puts up $1 billion. The bid also gets $800 million from Sequoia Capital, $700 million from Vy Capital and $500 million from Binance, with more than a dozen others contributing as well, according to company filings. Musk secures a pledge from Saudi Arabia’s Prince Alwaleed bin Talal, who agrees to roll over his nearly 35 million Twitter shares, worth about $1.9 billion at $54.20 per share.
May 6: Plans for Twitter revealed
In a pitch deck presented to investors and seen by the New York Times, Musk lays out aggressive growth plans for Twitter, including aiming to quintuple revenue $26.4 billion by 2028, from $5 billion last year, and increasing users to 931 million from 217 million. To accomplish this, he plans to expand the company’s negligible payments business currently used for tipping creators, and increase it to $15 million in revenue by 2023 and $1.3 billion by 2028. The deck also reveals plans to cut the company’s reliance on advertising to less than 50% of revenue, further develop a subscription product and prepare for fluctuating headcount.
May 10: Trump ban to be lifted
Musk confirms that he would reverse Twitter’s ban on former US president Donald Trump once he’s the owner.
“I would reverse the permanent ban,” he says at a Financial Times conference. “Perma bans just fundamentally undermine trust in Twitter as a town square where everyone can voice their opinion.”
“My opinion, and Jack Dorsey I want to be clear shares this opinion, is that we should not have permanent bans,” Musk says. Dorsey tweets his agreement, and both men add caveats that illegal behavior or spam wouldn’t be allowed.
May 12: Hiring freeze goes into effect and key executives depart
CEO Agrawal announces a hiring freeze and other cost-cutting efforts amid the state of uncertainty over the acquisition. Two of Twitter’s top leaders also depart: Kayvon Beykpour, head of consumer product, and Bruce Falck, in charge of revenue product. Beykpour tweets, “Interrupting my paternity leave to share some final @twitter-related news: I’m leaving the company after over 7 years.” He adds: “The truth is this isn’t how and when I imagined leaving Twitter, and this wasn’t my decision. Parag asked me to leave after letting me know that he wants to take the team in a different direction.”
According to an internal memo obtained by Bloomberg, the company is halting hiring and may rescind outstanding offers. The company is also pulling back on costs such as travel, consulting and marketing. Agrawal says global events, including the war in Ukraine and supply-chain crunch, have hurt Twitter’s business, but broad job cuts aren’t yet planned.
May 13: Musk hits the brakes
With bots surfacing as a deal breaker, Musk tweets, “Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users.” This sends Twitter’s stock plummeting. A few hours later he tweets that he is “still committed” to the acquisition and is waiting on confirmation that fake accounts on the social-media platform contributes to less than 5% of its users.
May 16: Musk and Agrawal have it out...on Twitter
In a tweetstorm, Agrawal explains that measuring spam accounts is complicated because some are actually real humans even if they look like spam, and vice versa. Twitter also allows bots on the service, so simply setting up an automated account is not against the rules. Musk is not impressed with Agrawal’s response and suggests calling users to verify their accounts. He then replies to Agrawal with a poop emoji.
May 17: Musk threatens to pull out
Musk declares that he won’t proceed with his takeover plan unless the social-media giant can prove bots make up fewer than 5% of its users. The comment stokes speculation that Musk may be trying to lower the price. But Twitter’s board says it plans to enforce the $44 billion agreement, and that directors have already voted to unanimously recommend that shareholders approve Musk’s $54.20-a-share offer.
If the deal falls apart due to financing issues, Musk would have to pay a $1 billion breakup fee, but he can’t walk away for just any reason. The merger agreement includes a specific performance provision that allows Twitter to force Musk to consummate the takeover, according to a securities filing. That could mean that, should the deal end up in court, Twitter might secure an order obligating Musk to complete the merger rather than winning monetary compensation for any violations of it.
July 8: Musk backs out of deal, citing ‘spam bots’
Musk backs out of the deal to buy the platform, saying in a regulatory filing that the company has made “misleading representations” over the number of so-called spam bots on the service. He also says in a letter to Twitter that the company hasn’t “complied with its contractual obligations” to provide information about how to assess how prevalent the bots are on the social-media service and argues that Twitter has failed to operate its normal course of business.
July 12: Twitter sues Musk
Twitter files suit in Delaware Chancery Court to compel Musk to complete the deal. In the lawsuit, Twitter says, “Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he — unlike every other party subject to Delaware contract law — is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away.” Musk then countersues Twitter, arguing the company misled investors and the SEC and was “frantically closing the gates on information in a desperate bid to prevent the Musk Parties from uncovering its fraud,” according to the filing reviewed by Bloomberg.
Sept. 29: Private texts revealed
As part of the lawsuit slated to go to trial on Oct. 17 in Delaware Chancery Court, Musk’s private text messages become public, revealing how the deal came together, including early conversations with Dorsey.
There are also a flurry of messages from industry insiders who offer suggestions on who should be CEO. Investor Bill Lee suggests Bill Gurley of Benchmark Capital. Steve Jurvetson pushes for the former chief business officer of Uber Technologies Inc., Emil Michael. And investor Jason Calacanis texts, “Put me in the game coach! Twitter CEO is my dream job.”
Oct. 4: Musk revives $44 billion takeover bid
To avoid a courtroom fight, Elon Musk revives his bid for Twitter at the original offer price of $54.20 a share. Twitter shares climb as much as 23% after resuming trading following a halt on the news.
Oct. 6: It’s do or die
Delaware Chancery Judge Kathaleen St. J. McCormick agrees to pause the court case to give the two parties a chance to complete the deal. A hard deadline is set for agreement to be reached by Oct. 28 at 5 p.m., or a trial will resume in November.
Oct. 27: Musk buys Twitter
With the court deadline approaching, Musk finalizes the deal and takes possession of Twitter.
His first act is to fire the executive leadership that thwarted him, including CEO Agrawal.
As he tweets plans for unbanning accounts and charging for user verification, there are murmurings of another wave of Twitter quitters. General Motors Co. pauses ads. Hollywood producer Shonda Rhimes tweets, “Not hanging around for whatever Elon has planned. Bye.”
The deal is done, ending Twitter’s nine-year run as a public company. But with Musk poised to cut jobs and shake up the company’s business model, the upheaval may just be beginning.
(Updates with closing of deal.)
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