Shares of Twitter Inc. were halted at noon on Tuesday after reports emerged that Tesla Inc. Chief Executive Elon Musk was now offering to buy the social media company at its original offering price, suggesting a possible end to the legal saga between the two parties.
A Bloomberg News report said Musk sent a letter to Twitter
with the la final proposal to acquire the company for $54.20 per share. Twitter shares were up 13% in midday trading before the shutdown. Trading was first halted due to volatility and then halted for pending news.
A Wall Street Journal report said Musk’s legal team relayed the proposal to the Twitter team “on Monday night” ahead of an emergency hearing scheduled for Tuesday.
Musk agreed in April to buy Twitter in a deal that valued the company at about $44 billionbut he later said he was terminate the agreement. The Tesla
The chief raised concerns about bot activity on Twitter and said he believed the company’s management team weren’t being specific in their public disclosures about the extent of the activity spam on the platform.
The two sides have been embroiled in a legal battle for months, and a Delaware Court of Chancery judge was scheduled to hear from both sides in a five-day trial that was scheduled to begin Oct. 17.
“It’s a clear sign that Musk admitted going to court in Delaware that the odds of winning against Twitter’s board were highly unlikely and that this $44 billion deal was going to be done in a way or another,” wrote Wedbush analyst Daniel Ives. “Being forced to complete the deal after a long and ugly legal battle in Delaware was not an ideal scenario and accepting this path and moving forward with the deal will avoid a huge legal headache.”