Elon Musk hears criticism and never hesitates to respond to it.
As a boxer who takes the blows of the opponent in the first rounds of a boxing match, the billionaire tends to have observation phases. He observes the opponents to try to find their weakness before hitting the fatal blow.
The whimsical CEO of Tesla (TSLA) – Get Tesla Inc Report has made a takeover bid of $ 44 billion, or $ 54.20 per Twitter (TWTR) – Get Twitter, Inc. report share, to buy the social network he describes as the “de facto town square” on the internet.
Musk explains that his decision is motivated by the desire to restore the principles of freedom of expression on the platform. The agreement has frightened Democrats, who say they fear the world̵[ads1]7;s richest man will handle the platform for conservatives, and especially extremist and far-right voices. They also say they fear an explosion of hate speech in the name of freedom of speech.
Musk has so far said that his Twitter will tolerate comments that fall within the legal scope and respect the current legislation in each country where the social network operates. Basically, as long as something does not break the law, it will be accepted on Twitter.
The transaction also raises questions about financing. The billionaire managed to secure $ 46.5 billion in bank loans and margin loans guaranteed by his Tesla shares. And this part that represents $ 21 billion is the one that all eyes are on. Musk, who sold millions of Tesla shares for just over $ 8.5 billion, wants to reduce this cash contribution related to his personal fortune, according to Reuters.
The new financing can come in the form of preferred or joint equity. Musk is trying to convince certain major shareholders in Twitter, hedge funds and wealthy individuals to provide preferred equity financing for the acquisition.
The billionaire is also trying to convince some shareholders not to sell their shares as part of the offer, but to remain shareholders in the group even when it will be delisted.
Jack Dorsey, the founder and former CEO of Twitter, is among the shareholders Musk is said to have told about his plans.
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Musk himself appeared to confirm this information by commenting on a Twitter post that covered the Reuters story.
“Also, as mentioned before, we will try to keep as many shareholders as legally possible on privately owned Twitter!” said the billionaire whose net worth is estimated at $ 258 billion as of May 3, according to the Bloomberg Billionaires Index.
A fee for commercial / public users
Beyond funding, the second question that many observers ask is, what economic model does Musk intend to use for Twitter? The tycoon had mentioned the idea of removing advertising from the platform, and especially for subscribers to Blue, a subscription service offered by Twitter that gives users access to premium features, such as the ability to cancel a Tweet. These features are available wherever you use the Twitter account you subscribed to.
“Everyone who signs up for Twitter Blue (ie pays $ 3 / month) should get an authentication badge,” Musk suggested on April 9, referring to one of the new products. “Blue already has a modifiable 20 seconds to edit the tweet feature,” he added.
Musk has just unveiled the first ideas for the financial model he intends to put in place when he has completed the acquisition of Twitter in October if all goes as planned. The founder indicates that the platform will remain free for regular users. But on the other hand, Twitter will charge a small fee for businesses, businesses and public users.
“Twitter will always be free for casual users,” Musk told his more than 90 million followers on Twitter on May 3. “But maybe a small cost for commercial / government users.”
The billionaire did not give further details: How much will this small cost be? Who falls into the government category?
Twitter Blue currently costs $ 2.99 per month. However, Twitter mainly derives its revenue from advertising.
A lot of speculation about Musk’s intentions regarding Twitter. The Wall Street Journal just reported that the mogul intends to take the company back with a stock exchange listing within the next three years.