Twitter (NYSE:TWTR) stock is up 4% today on reports that its board of directors is reconsidering Elon Musk’s offer to buy the social media giant.
Both The New York Times and The Wall Street Journal are reporting today that Twitter’s board met on Sunday, April 24, to discuss Musk’s bid to acquire the company and take it private.
The board meeting was called after Musk disclosed late last week that he has secured $46.5 billion in financing to buy Twitter outright.
What Happened With TWTR Stock
Musk, who is the CEO of Tesla (NASDAQ:TSLA) and the world’s richest person with a net worth above $250 billion, has offered to buy Twitter for $54.20 a share. TWTR stock finished trading on April 22 at $48.93 a share.
The Wall Street Journal reported over the weekend that Twitter executives are re-examining Musk’s bid and are more likely than before to negotiate with the billionaire. The board had previously rebuffed Musk’s takeover bid and adopted a so-called “poison pill” strategy where they would dilute the company’s share count to prevent Musk from acquiring a majority of the stock.
Why It Matters
Musk’s purchase of Twitter would represent a major sea change among social media companies and could lead to significant changes at Twitter. In recent years, Twitter has come under criticism for spreading disinformation and blocking certain individuals and organizations from using its platform.
However, while Twitter’s board might now be reconsidering Musk’s offer, other media reports say that the board members continue to look for other suitors. The company could provide an update on the entire situation when its reports first-quarter earnings this on April 28, if not sooner.
Elon Musk has said repeatedly in recent weeks that his offer to acquire Twitter is his best and final offer. There have been no reports that he has changed his initial bid of $54.20 a share or agreed to concessions.
What’s Next for Twitter
The drama surrounding Twitter looks likely to continue for a few days more, at least. The fact that Twitter’s board is now considering accepting Musk’s takeover offer is good news for the stock. However, the long-term outlook for the company remains uncertain and how any potential takeover ultimately concludes is unknown.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.