Tue, 29 November 2022
The Daily Ittefaq

Elon Musk completes $62b Twitter takeover, fires CEO and other top executives

Update : 28 Oct 2022, 11:42

Elon Musk completed his US$44 billion (S$62 billion) acquisition of Twitter, according to people familiar with the matter, putting the world’s richest man in charge of the struggling social network after six months of public and legal wrangling over the deal.

Shareholders will be paid US$54.20 per share, and Twitter will now operate as a private company.

The completion caps a convoluted saga that began in January with the billionaire’s quiet accumulation of a major stake in the company, his growing exasperation with how it’s run and an eventual merger accord that he later spent months trying to unravel. 

On Oct 4, Mr Musk agreed to proceed on his originally proposed terms, and a Delaware Chancery Court judge gave the two sides until Oct 28 to wrap up the deal.

That deadline was met, and now Mr Musk, who is chief executive officer of both Tesla and SpaceX, also controls Twitter, a service he uses often but criticises openly, and that he has promised to change dramatically. The company’s shares are no longer expected to trade on the New York Stock Exchange.

Twitter Chief Executive Officer Parag Agrawal is among executives planning to depart as Mr Musk completes his takeover.

Also leaving are Ms Vijaya Gadde, the head of legal, policy and trust; Chief Financial Officer Ned Segal, who joined Twitter in 2017; and Mr Sean Edgett, who has been general counsel at Twitter since 2012, according to people familiar with the matter, who declined to be named because the information isn’t public. Mr Edgett was escorted out of the building, said two of the people.

Twitter didn’t immediately respond to a request for comment.

Mr Agrawal stepped into the CEO role in November, when co-founder Jack Dorsey unexpectedly resigned. Mr Agrawal had been at Twitter for almost a decade, most recently as chief technology officer, but his run as CEO was quickly disrupted by Mr Musk’s arrival as a major shareholder and increasingly vocal antagonist of its current leadership.

After Mr Musk showed up, it became clear that Mr Agrawal was unlikely to keep his job. “I don’t have confidence in management,” Musk said in one early filing about the deal, and the two executives exchanged some public swipes. In May, Mr Musk replied to a Twitter thread from Mr Agrawal defending the company’s user metrics by tweeting back a poop emoji.

Text messages unveiled during the lawsuit show that the two men had a contentious exchange early on during the deal process after Mr Musk asked his followers whether Twitter was “dying”. 

Mr Agrawal confronted him via text. “You are free to tweet ‘is twitter dying?’ or anything else about Twitter,” he wrote on April 9, “but it’s my responsibility to tell you that it’s not helping me make Twitter better in the current context.”

Mr Musk fired back, “What did you get done this week?” And then: “I’m not joining the board this is a waste of time.”

The following week, in messages with a friend, Mr Musk mocked Mr Agrawal for being on vacation in Hawaii during deal negotiations. “Shouldn’t he be in a war room right now?!?” investor Jason Calacanis messaged Mr Musk. “Does doing occasional zoom calls while drinking fruity cocktails at the Four Seasons count?” Mr Musk replied.

Efforts by former Twitter CEO Dorsey to reconcile Mr Musk, a longtime Dorsey friend, and Mr Agrawal after the deal was announced also ended poorly. “At least it became clear that you can’t work together,” Mr Dorsey messaged Mr Musk after a group call. “That was clarifying.”

Mr Agrawal won’t be leaving empty handed. As part of the deal, the CEO will vest 100 per cent of his unvested equity awards, according to a filing. Research firm Equilar estimated that means he’ll make an estimated US$42 million, Reuters reported.

As Twitter’s head of legal and policy issues, Ms Gadde has overseen the creation and enforcement of rules for hundreds of millions of Internet users, including prominent ones that are subject to looser content limitations under the company’s exemptions for newsworthy posts or world leaders’ communications.

In acquiring Twitter, Mr Musk has promised to turn it into a less-restrictive platform for free speech, a move he has said is “essential to a functioning democracy.” 

Ms Gadde was hit with a spate of online abuse earlier this year after Mr Musk publicly criticised content-related decisions at Twitter. The company permanently banned former US president Donald Trump in January 2021 following his supporters’ attack on the Capitol.

Mr Musk’s statements leading up to his purchase of the social-media company have led many to expect the billionaire will restore Mr Trump’s account and reinstate other users who have been blocked for breaking rules on offensive or dangerous content.

As the deadline neared, Mr Musk began putting his stamp on the company, posting a video of himself walking into the headquarters and changing his profile descriptor on the platform he now owns to “Chief Twit”.

He arranged meetings between Tesla engineers and product leadership at Twitter, and he planned to address the staff on Friday, people familiar with the matter said.

Twitter’s engineers could no longer make changes to code as of noon Thursday in San Francisco, part of an effort to ensure that nothing about the product changes ahead of the deal closing, the people said.

The prospect of less restrictive content moderation under Musk’s leadership has prompted concerns that dialogue on the social network will deteriorate, eroding years of efforts by the company and its “trust and safety” team to limit offensive or dangerous posts. On Thursday, Musk posted a note to advertisers seeking to reassure them he doesn’t want Twitter to become a “free-for-all hellscape.”

The past six months have been challenging for Twitter employees, who have primarily followed the ups and downs of the roller-coaster deal through the news headlines.

Many have been unhappy with Mr Musk’s involvement, with some questioning his qualifications to run a social networking company.

His support of a far-right political candidate in Texas, plus sexual harassment accusations from a former SpaceX flight attendant in May, have raised concerns with many of Twitter’s workers.

During a video Q&A with Mr Musk in June, some employees mocked him on internal Slack channels. Others have ridiculed or chided him publicly on Twitter throughout the deal process. 

 

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