Elon Musk has completed a $44 billion acquisition of Twitter, giving the world’s richest man the helm of one of the world’s most influential social media platforms, a source familiar with the deal told CNN on Thursday. one.
Musk fired CEO Parag Agrawal and two other executives, according to two people familiar with the matter. Twitter declined to comment.
The closing of the deal removes the uncertainty that has hung over Twitter’s business, employees and shareholders for much of the year. After initially agreeing to buy the company in April, Musk spent months trying to pull out of the deal, first over concerns about the number of bots on the platform and then allegations from a company whistleblower.
By closing the deal, Musk and Twitter avoided a trial scheduled earlier this month. But Musk’s acquisition, along with the immediate firing of some executives, now raises many new questions about the future of the social media platform and the corners of society it affects. Musk also fired CFO Ned Segal and policy chief Vijaya Gadde on Thursday, according to two sources.
Musk has said he plans to reconsider Twitter’s content moderation policy in favor of a more extremist approach to “free speech.” The billionaire also said he disagreed with Twitter’s move to permanently ban those who repeatedly violated its rules, raising the prospect of some previously banned, controversial users reappearing on the platform.
Perhaps most immediately, many will be concerned about how soon Musk can get former President Donald Trump back on the platform, as he has said before. Depending on the timing, such a move could have major implications for the upcoming U.S. midterm elections and the 2024 presidential race.
In taking these steps, Musk can single-handedly upend the media and political ecosystem, reshape public discourse online, and disrupt conservative social media properties that have emerged largely in response to dissatisfaction with bans and restrictions on Twitter and other mainstream services nascent field.
Earlier this week, Musk visited Twitter’s San Francisco headquarters to meet with employees. He also released an open letter to Twitter advertisers, saying he didn’t want the platform to be a “hellish environment where anything can be said without consequences.”
The acquisition is also expected to expand Musk’s influence. The billionaire already owns, oversees or holds large stakes in companies developing cars, rockets, robotics and satellite internet, as well as more experimental ventures such as brain implants. Now he controls a social media platform that shapes the way hundreds of millions of people communicate and get news.
Even for Twitter, which is known for a degree of chaos in its history, the months-long deal with Musk has been tumultuous.
Musk, a well-known and controversial Twitter user, got involved with the company earlier this year when he owned more than 9% of the company. After announcing to be Twitter’s largest shareholder, Musk accepted and withdrew his offer to join the company’s board.
Musk then offered to buy Twitter outright at a hefty premium, threatened a hostile takeover, and signed a “seller-friendly” deal to acquire companies that involved waived due diligence.
“It’s not a way to make money,” Musk said in an on-stage interview shortly after his offer to buy Twitter. “My strong hunch is that having a public platform of maximum trust and broad inclusion is extremely important to the future of civilization.”
Musk also promised to “defeat spam bots or die,” referring to fake and scam accounts that are often particularly active in replying to his tweets and others with large followings on the platform.
However, within weeks of the acquisition agreement being signed, Musk began to express concerns about the prevalence of the same fake and spam accounts on Twitter, and eventually tried to terminate the deal.
Twitter sued him to honor the agreement, alleging that Musk used the bot argument as an excuse to back out of a deal he had already generated buyer remorse. In the weeks after the deal was announced, most stocks, including social media companies, fell on fears of rising inflation and a looming recession. The downturn has also hit Tesla, which in turn hit Musk’s personal net worth.
Legal experts generally agree that Twitter has a strong ability to enforce the deal in court. Two weeks before the contentious legal battle is due to go to trial, Musk said he would go through the deal on the original terms after all. As the two sides negotiated, Musk’s lawyers asked a judge to suspend the legal process, prompting a backlash from Twitter, which feared Musk might not keep his promise to close the deal.
In a fiery response, Twitter’s lawyers wrote that Musk had been trying to back out of the deal, “and now, on the eve of trial, the defendants have announced that they ultimately intend to close the deal. “Trust us,” they said, “this time we’re serious.” ”
Delaware Chancellor Judge Kathaleen St. McCormick gave the parties until 5 p.m. on Oct. 5. 28 to close the deal or face a rescheduled trial.
With the deal drama over, attention now turns to Musk’s Twitter plans.
In addition to removing Twitter’s CEO and other executives, Musk’s acquisition could also restore some influence over the company by founder Jack Dorsey, who stepped down as CEO in November and left the board in May. While Dorsey said he would not officially return to Twitter, he privately discussed the acquisition with Musk and offered advice.
Musk also reportedly told potential investors in the deal that he plans to lay off nearly 75 percent of the company’s workforce, a move that could disrupt every aspect of Twitter’s operations. He had previously disclosed in court filings that he had significantly reduced Twitter’s workforce in personal text messages with friends about the deal, and did not deny the possibility of layoffs in a June conference call with Twitter employees.
Under Musk’s leadership, many of Twitter’s current employees may not be available. Musk has repeatedly made clear that he will overhaul Twitter’s content moderation policies and support what he calls “free speech,” which could undermine the company’s years-long efforts to tackle misinformation and harassment and create “healthier” conversations on the platform efforts made.
Such a move could also have ripple effects across the social media landscape. Twitter, while smaller than many of its social media rivals, has at times served as a model for how the industry handles questionable content, including when it first banned then-President Trump after the Jan. 6 riots in the Capitol.
A number of alternative social networks have been launched in recent years, mainly targeting conservatives who claim that more mainstream services overly restrict their speech. Those services include Trump’s Truth Social and Parler, which Kanye West recently said he would acquire. While it’s unclear how far Musk can go in realizing his free speech dreams, any relaxation of existing content moderation policies could effectively allow Twitter to provide a larger audience for some users fleeing to smaller users Provide more attractive services, edge services. (However, Musk could run into regulatory issues, especially in Europe, depending on how hard he tries to loosen content restrictions.)
In addition to content moderation, Musk has proposed a range of other possible changes to the platform, from enabling end-to-end encryption for Twitter’s direct messaging feature to recently suggesting that Twitter be part of an “everything” app called X , probably in the style of the popular Chinese app WeChat.
Musk has been trying to be optimistic about Twitter’s potential, despite his months-long attempts to pull out of buying the company, and he recently said he was “obviously overpaying for it.”
“In my view, Twitter’s long-term potential is an order of magnitude greater than its current value,” he said on Tesla’s earnings call last week.