Elon Musk has offered to buy Twitter for $54.20 a share, saying the company needs to be transformed privately. Musk is already the company's second-largest shareholder.
Drew Pascarella, senior lecturer at Cornell University, is an expert on corporate finance and merger and acquisition transactions, including deal process and valuation. A former senior investment banker, he has extensive expertise with transactions in the technology and telecommunications industries.
“The concept of taking a company private to effect fundamental change is not new. Michael Dell’s take-private of his namesake company is the best recent example of this strategy. And Twitter would benefit from fundamental change. Unlike Meta and Google, which generate unfathomable cashflow, Twitter’s financial performance continues to be lackluster. Will a shift away from ads and to a pay model create value? That is question two. Question one is whether Elon is serious about this. Who knows? The closer Twitter stock gets to $54.20, the more the market is betting this will actually happen. This is a classic wait and see situation.”