ZINGER KEY POINTS
- Twitter shares are expected to be delisted from the NYSE on Friday.
- The CEO and CFO of Twitter are out, with Elon Musk expected to lead the company in the interim.
A highly anticipated takeover of a leading social media platform looks to be finalized Friday. Here’s what Twitter Inc investors and fans of Tesla Inc CEO Elon Musk should know.
The Acquisition:
Musk is acquiring Twitter for $44 billion, or $54.20 per share, in a deal expected to be finalized Friday. Musk agreed to acquire the company back in April. After walking away and being sued by Twitter, Musk later agreed once again to acquire the social media platform for the same price.
Twitter Shares:
Twitter shares will be delisted from the New York Stock Exchange as a result of the acquisition. Shares are expected to be delisted on Friday. Shareholders will receive $54.20 for each share of Twitter they own.
Twitter will be removed from several stock indexes, including the prominent S&P 500, tracked by the SPDR S&P 500 ETF Trust.
Insurance company Arch Capital Group was announced as the replacement to Twitter in the index. Shares of Arch Capital are up 6% in pre-market trading, hitting new 52-week highs.
Who’s In Charge?:
With news of Musk finalizing the deal to acquire Twitter, it was announced Thursday night that Twitter CEO Parag Agrawal and Chief Financial Officer Ned Segal are no longer employees of Twitter. Agrawal will receive over $40 million after being let go by the company.
Musk publicly called out Agrawal numerous times during the acquisition process of Twitter. Leaked texts also revealed frustration with the way Agrawal was running the company, which should make his departure of little surprise to investors and anyone familiar with the matter.
Agrawal had been CEO of Twitter since November 2021 and spent over a decade with the social media company.
Legal affairs and policy chief Vijaya Gadde was also let go by Twitter. Gadde was prominent in decisions to ban people like former President Donald Trump from Twitter. Politico reported earlier this year that Gadde cried in a staff meeting after learning of Musk’s takeover attempt and the potential of the platform changing.
Musk is expected to be the interim CEO until he names a replacement. The role comes in addition to Musk’s CEO title at both Tesla and SpaceX.
Many investors expect Musk to consider putting Twitter co-founder and former CEO Jack Dorsey in charge to turn around the company. Musk and Dorsey exchanged numerous texts about the direction of the company after the deal was announced.
Twitter Employees:
Reports surfaced recently that Musk planned to cut 75% of workers from Twitter. Musk denied the reports.
On Thursday, Musk brought in engineers from Tesla to review coding for Twitter and to highlight changes that need to be made. This suggests that engineers could be cut or leave in protest of losing control to Tesla engineers.
Musk addressed job cuts earlier this year during a town hall with Twitter employees.
“If someone is getting useful things done, that’s great. If they’re not, then I’m like, ‘why are they at the company?” Musk said.
Musk said employees shouldn’t be worried about job cuts if they were “significant contributors” to Twitter.
Musk also said that Twitter employees who were exceptional at their job would be allowed to work remotely. Musk has been vocal against remote workers for Tesla, but acknowledged that cars couldn’t be made remotely.
Reversals Of Ban On Donald Trump, Others:
One item that doesn’t have a clear timeline yet is the decision to reverse bans on several notable people on Twitter. Among them is former president Donald Trump.
Musk said earlier this year that he planned to reinstate Trump on the platform if he took over the company.
“Permanent bans should be extremely rare and really reserved for … accounts that are bots or spam/scam accounts,” Musk said.
Musk said he didn’t believe Trump should have been banned from the platform and called it a mistake. The Tesla CEO said the ban “alienated a large part of the country.”
Trump previously said he would not rejoin Twitter even if the ban is reversed. Trump now posts his messages to followers and supporters on Truth Social, a company owned by his Trump Media & Technology Group. The media company owned by Trump is in the process of merging with Digital World Acquisition Corp to go public.
On Thursday, Musk said in a letter to Twitter advertisers that he believed Twitter should be a welcoming place for all and both sides of the political aisle.
“There is currently great danger that social media will splinter into far right wing and far left wing echo chambers that generate more hate and divide our society.”
Musk said he bought Twitter to “try to help humanity.”
—
Originally Posted October 28, 2022 – Elon Musk Takes Over Twitter: Who’s In Charge, Who’s Gone And What Happens To The Stock?
Disclosure: Benzinga
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Disclosure: Interactive Brokers
Information posted on IBKR Campus that is provided by third-parties does NOT constitute a recommendation that you should contract for the services of that third party. Third-party participants who contribute to IBKR Campus are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.
This material is from Benzinga and is being posted with its permission. The views expressed in this material are solely those of the author and/or Benzinga and Interactive Brokers is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to buy or sell any security. It should not be construed as research or investment advice or a recommendation to buy, sell or hold any security or commodity. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.
