World's richest man buys Twitter for $60.4 billion

NEW YORK • Billionaire Elon Musk has clinched a deal to buy Twitter for US$44 billion (S$60.4 billion) in cash in a transaction that will shift control of the social media platform populated by millions of users and global leaders to the world's richest person.

It is a seminal moment for the 16-year-old company, which emerged as one of the world's most influential public squares and now faces a string of challenges.

Mr Musk, who calls himself a free-speech absolutist, has criticised Twitter's moderation. He wants Twitter's algorithm for prioritising tweets to be public and objects to giving too much power on the service to corporations that advertise.

Political activists expect that a Musk regime will mean less moderation and reinstatement of the accounts of banned individuals including former United States president Donald Trump.

Conservatives cheered the prospect of fewer controls while some human rights activists voiced fears of a rise in hate speech.

Mr Musk has also advocated user-friendly tweaks to the service, such as an edit button and defeating "spam bots" that send overwhelming amounts of unwanted tweets.

Discussions over the deal, which last week appeared uncertain, accelerated over the weekend after Mr Musk wooed Twitter shareholders with financing details of his offer. Under pressure, Twitter started negotiating with Mr Musk on buying the company at his proposed US$54.20 per share price.

"Free speech is the bedrock of a functioning democracy, and Twitter is the digital town square where matters vital to the future of humanity are debated," Mr Musk said in a statement.

Former Twitter CEO Jack Dorsey weighed in on the deal late on Monday with a series of tweets that thanked both Mr Musk and current Twitter CEO Parag Agrawal for "getting the company out of an impossible situation".

"Twitter as a company has always been my sole issue and my biggest regret. It has been owned by Wall Street and the ad model. Taking it back from Wall Street is the correct first step," he said.

Twitter shares rose 5.7 per cent on Monday to finish at US$51.70.

The deal represents a near 40 per cent premium to the closing price the day before Mr Musk disclosed that he had bought a more than 9 per cent stake. Even so, the offer is well below the US$70 range where Twitter was trading last year.

Mr Musk's move continues a tradition of billionaires buying control of influential media platforms, including Mr Jeff Bezos' 2013 acquisition of the Washington Post.

Mr Bezos asked in a post on Twitter on Monday if the deal to buy the US social media platform gives China "a bit of leverage over the town square". Twitter is blocked in China, where Mr Musk has key business interests.

Twitter said Mr Musk secured US$25.5 billion of debt and margin loan financing and is providing a US$21 billion equity commitment.

Mr Musk, who is worth US$268 billion according to Forbes, has said he is not primarily concerned with the economics of Twitter.

"Having a public platform that is maximally trusted and broadly inclusive is extremely important to the future of civilisation. I don't care about the economics at all," he said in a recent public talk.

Mr Musk is chief executive of both electric carmaker Tesla and aerospace company SpaceX, and it is not clear how much time he will devote to Twitter or what he will do.

The Twitter transaction was approved by the company's board and is now subject to a shareholder vote. No regulatory hurdles are expected, analysts said.

Although it is only about a tenth of the size of far larger social media platforms like Meta Platforms' Facebook, Twitter has been credited with helping to spawn the Arab Spring uprising and accused of playing a role in the storming of the US Capitol on Jan 6 last year.

After Twitter banned Mr Trump over concerns around incitement of violence following the US Capitol attack by his supporters, Mr Musk tweeted: "A lot of people are going to be super unhappy with West Coast high tech as the de facto arbiter of free speech."

Mr Trump, whose company is building a rival to Twitter called Truth Social, said in a Fox News interview on Monday that he is unlikely to return to Twitter.

The White House declined on Monday to comment on Mr Musk's deal, but said President Joe Biden has long been concerned about the power of social media platforms. "Our concerns are not new," said White House spokesman Jen Psaki, adding that the platforms need to be held accountable.

"The President has long talked about his concerns about the power of social media platforms, including Twitter and others, to spread misinformation."

REUTERS