Elon Musk has offered to push through with his buyout of Twitter at the original agreed price, reports said Tuesday, prompting a surge in the share price of the social network that triggered a suspension of trading.
US media said the world’s richest man had sent a letter to Twitter vowing to honour the original buyout price of $54.20 a share -– a U-turn on his effort to terminate the deal that saw Twitter take Musk to court in a case due to be heard later this month.
Shares were halted soon after the Bloomberg report citing unnamed sources near midday.
The latest twist in the ongoing saga comes less than two weeks before the start of a high-stakes trial in a suit by the tech firm to hold the Tesla chief to a $44 billion buyout deal he signed in April.
Musk himself has been slated to be deposed by Twitter attorneys later this week in preparation for a trial.
A serial entrepreneur made rich through his success with Tesla, Musk originally sealed a deal to acquire the social media company in April, but soon after began to step back from the transaction.
Musk, the world’s richest man, said in a letter in July that he was cancelling the deal because he was misled by Twitter concerning the number of bot accounts on its platform, allegations rejected by the company.
Twitter, meanwhile, has been seeking material or testimony to prove Musk is contriving excuses to walk away because he changed his mind. In July, a Delaware judge agreed to a fast-track a trial on Twitter’s allegations, which the company has argued is impeding its financial performance.
Wedbush analyst Dan Ives said that Musk’s apparent pivot shows that he recognized heading into Delaware Court that the chance of winning against Twitter’s board was highly unlikely, and this $44 billion deal was going to be completed one way or another,” he said in an email.
“We see minimal regulatory risk in this deal although now Musk owning the Twitter platform will cause a firestorm of worries and questions looking ahead among users and the Beltway. This is a smart move for Musk to go ahead with the deal given the legal hurdles that were ahead into Delaware.”
Near 1710 GMT, shares in Twitter were up 12.7 per cent at $47.95, having been halted nearly an hour ago by the New York Stock Exchange following a Bloomberg report on a possible new takeover offer.